Q1 2026 Newsletter & Market Review

Hi All, 

Welcome to the Q1 newsletter & market review.  

Q1 Market Performance 

The first quarter of 2026 felt a lot like that of 2025.  Last year, the announcement of the administration’s tariff policy sent stocks into bear market territory (-20%).  This year, the War in Iran has spiked oil prices and sent the S&P 500 and tech stocks into correction territory (-10%).  Even with the early volatility in 2025 the market bounced back and had a positive year.  Hopefully, we are experiencing that same rebound, as the S&P 500 has rebounded slightly in the past few days ending the first quarter down 4.8% YTD. The first quarter produced positive returns for small-cap, mid-cap, and international equities.  This is another great example of how a diversified approach in our portfolio helps level out returns and reduce risk. Fingers crossed we see a similar rebound as 2025 as we move into the second quarter.  

Year-to-date Returns   

S&P 500 -4.81%

Total Market -4.51%

Tech -5.87%

Mid Cap +0.93%

Small Cap +2.42%

International +0.92%

Newsletter Topics  

War in Iran & Oil Prices - The cost of oil touches just about everything.  Prior to the war, oil prices hovered around $70 per barrel (February 28th).  Today, prices have spiked to $100-$119 per barrel.  The spike in oil prices is currently the largest contributor to the market volatility.  Keep in mind that geopolitical events have the ability to move markets in the short term, but company earnings drive long term returns. 

The Fed Projects One Rate Cut - Good for high-yield savings accounts.  Bad for borrowing costs and mortgage rates.  It seemed as though the Federal Reserve would take a more aggressive approach to cutting rates at the beginning of the year.  With the War in Iran and inflation on the rise, the Fed is projecting just one rate cut this year as they take a “wait and see approach.”  This will keep yields up on cash reserves.  On the flip side, it will keep interest rates associated with borrowing high.  

Mortgage Rates - Mortgage rates saw it’s first significant decline in quite some time in the first quarter.  Many clients who bought with elevated interest rates have inquired about refinancing.  Unfortunately, rates have ticked up aggressively since the conflict in the Middle East began.  The average 30-year mortgage rate currently sits at 6.61%.  This could be another slow year for the real estate market. 

Taxes - Just a reminder that the tax deadline is quickly approaching.  Be sure to file your taxes or an extension. 

I'm looking forward to our next client meeting!   Feel free to schedule our next meeting using the link below.  Now is a great time to revisit your financial data in Right Capital (income, goals, savings rate) to ensure your financial plan is up to date.  

Please share the newsletter with friends or colleagues who might find this information helpful.  Our updated firm brochure is attached.   

David