Market Analysis

Our fund managers and analysts comment on market movements and what may be ahead.

Review current performance analyses and weekly statistics for stock and bond markets in the U.S. and abroad, including regional and broad-based international indexes and principal currency exchange rates.

This page provides a recap of last month's key U.S. and international market action, complete with returns for the major averages, a U.S. economic outlook, and timely investment perspectives from T. Rowe Price fund managers.

Despite a steady stream of harrowing news—euro crisis, faltering economy, midyear market swoon, fiscal cliff—the markets had another strong year in 2012. Stocks continued to rally, as emerging-markets equities (as measured by the MSCI Emerging Markets Index) led the way with an 18% gain.

In a recent interview, Andy Brooks, Head of U.S. Equity Trading and T. Rowe Price Chief Economist Alan Levenson discuss the state of the U.S. economy and the financial markets.

Falling interest rates have boosted bond and bond fund returns for the past few years due in part to unprecedented central bank intervention. But the economy is recovering, and Federal Reserve officials are considering when to curtail or stop asset purchases. We recognize that interest rates will eventually rise from historic lows.

In the first quarter of 2013, the U.S. stock market saw many indexes hit all-time highs despite lingering domestic and global concerns. John Linehan, T. Rowe Price's director of U.S. Equity and the manager of the U.S. Large-Cap Value Equity Strategy, discusses the dramatic market recovery, where we are now, and what to look for moving forward.

The last two years in the eurozone saw periods of calm and of stress, and 2013 should too. The extremes of 2011 and 2012 may not be reached, but periods of stress will remain a constant. Investors should keep in mind that stress could help resolve the crisis by forcing needed changes.

Read what T. Rowe Price managers are saying about U.S. and world market events of the past quarter, quarterly statistics on market indices, and manager perspectives on what lies ahead for investors.

Trade deals, a surge in manufacturing, and a burgeoning middle class are boosting Mexico's economy. A new government is attempting to bring about structural reforms that would increase wages, improve education, and reform taxes, making the country a promising long-term investment opportunity.

Stocks have generated strong gains in the past couple of years, but slower global economic growth, decelerating earnings growth, and fiscal instability in developed markets could weigh on performance. With bonds continuing to generate historically low yields, uncertain investors are wondering which assets offer the best opportunities.

What can we expect in 2013 from the ongoing European financial crisis? 2011 and 2012 were both characterized by periods of calm and stress. Although we should avoid the extremes of those years, swings in temperature are an integral part of the eurozone crisis.

The American Taxpayer Relief Act of 2012, the compromise bill passed on January 1 to deal primarily with tax aspects of the fiscal cliff, provided investors an element of certainty heading into 2013. The tax changes were permanent and mostly affected those in upper income levels.

In a recent interview, T. Rowe Price Chief Economist Alan Levenson; Portfolio Manager David Giroux; and Stuart Ritter, CFP^®; discuss the state of the U.S. economy and the financial markets.

Last year, equity markets in the U.S. and around the world rebounded, despite a debt crisis in Europe, slower growth in China, and the impending fiscal cliff at home. T. Rowe Price Chairman Brian Rogers and Global Equity Manager Bill Stromberg discuss forces affecting equity markets and what investors should look for in 2013.

Congress enacted the American Taxpayer Relief Act of 2012 in order to avert the fiscal cliff. As expected, the tax changes affect higher wage earners, but Congress still needs to address spending cuts and the debt ceiling in the near future. Investors may see some market volatility as these issues continue to be addressed.

Some of the firm's top experts gave their forecasts for the coming year for U.S. and international stocks, as well as health-care stocks.

Some of the firm's top experts gave their forecasts for the coming year for the U.S. economy, U.S. and international bonds, and the European sovereign crisis.

Once the darling of the investment universe, emerging market stocks have performed poorly against their developed counterparts for the past two years. But Todd Henry, a portfolio specialist who works with T. Rowe Price's emerging markets equity managers, explains why the underlying growth story in the developing world remains solid.

In a recent interview, T. Rowe Price Chief Economist Alan Levenson and T. Rowe Price Retirement Funds Manager Jerome Clark discuss the state of the U.S. economy and the financial markets.

As we commemorate our 75th anniversary this year, several former and present T. Rowe Price investment professionals share their thoughts about a man who envisioned a different way to do business and the company he founded..

In its July 9, 2012 "Best Bond Funds" article that studied some of the largest and most successful bond investment firms, Barron's cited T. Rowe Price's solid reputation, conservative approach, and "good, old-fashioned bond picking."

The managers of T. Rowe Price's domestic stock funds recently shared their outlooks in shareholder reports covering the six months ended June 30, 2012. U.S. stocks managed a healthy gain in the first half of the year, but not before suffering a sharp correction in the spring brought about by renewed worries over the European debt crisis and other factors.

While the U.S. economy has been resilient and stocks have rallied in the last three years, global equity markets have been volatile, as investors seem to alternate frequently between a "risk on" and a "risk off" mentality.

European Central Bank (ECB) President Mario Draghi recently sketched out a plan that could be a significant positive for the eurozone periphery. However, it will not solve the underlying causes of the eurozone crisis, such as competitiveness imbalances, fiscal deficits, and excessive debt, and several risk factors remain.

In a recent conversation with T. Rowe Price's Todd Cleary, Chief Economist Alan Levenson and T. Rowe Price International Stock Fund Manager Bob Smith discuss the state of the U.S. economy and the financial markets.

The Spanish government and EU institutions recently announced that the European Financial Stability Facility or the European Stability Mechanism will lend up to €100 billion to the Spanish government to recapitalize its banking sector. The announced program is likely to be the first step toward a bigger rescue of the sovereign.

The managers of T. Rowe Price's international funds recently offered their economic and market outlooks in the funds' semiannual reports to shareholders. The reports cover the six-month period ended April 30, 2012.

With the T. Rowe Price High Yield Fund closing to new investors at the end of April 2012, prospective investors have been increasingly interested in the T. Rowe Price Floating Rate Fund as an attractive alternative. Both portfolios are overseen by the same team of analysts and managers and are constructed using disciplined research to help manage risk.