Market Update: June 2021

Featured Market Data

Reopening Stocks Outperform

Value stocks outperformed growth stocks in May, a trend which has persisted throughout 2021. Strong performance for value stocks is a reversal of last year’s trend when growth stocks, including technology shares, soared. A surge this year in business activity is driving up shares of more economically sensitive sectors such as manufacturing, energy and materials. Many of these companies beat first quarter earnings expectations and upwardly revised their earnings projections. Pent up demand could further aid value stocks, while growth stocks face headwinds from higher valuations and greater sensitivity to rising interest rates.

Source: Wall Street Journal, Bloomberg

Recent News

ESG Driving Change

An activist investor won at least two seats on Exxon Mobil Corp.’s board on May 28. The defeat of board members supported by management will likely require the company to alter its strategy. Engine No. 1, an upstart hedge fund and activist investor, said its board candidates have the qualifications to help Exxon better prepare for a world less dependent on fossil fuels. On the same day, a Dutch court ordered Royal Dutch Shell to reduce its carbon emissions by 45% by 2030. The court ruled that Shell is partially responsible for climate change. Together, these events highlight how significantly climate change and other ESG factors are impacting the investment landscape.

Source: Bloomberg

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