Chris Hyzy:                This is Chris Hyzy, Chief Investment Officer, for the market update for April 3rd. To start off the month, there's a number of different headlines that we are not only paying attention to but hunting for the collateral effects thereof. First and foremost, over the weekend OPEC+ did agree to what in effect is a $1.1 million barrel per day cut to production, which ultimately should hit May but gather more steam into the fall months. Oil prices rose almost 7% or 8% at their highest and then finished up 6% overnight to about $79.00 a barrel in West Texas Intermediate. Overall, the oil price direction is now upward versus downward but going into a so-called mild recession, we think on par happens here is with less demand and a cut to supply overall in the next six months, expect elevated oil prices from what we originally expected. Having said all that, it is clear that OPEC+ is getting up ahead of whatever slowdown is coming. We'll see how this filters into the broader markets overall, but certainly as it relates to inflation there will be some questions in headline risk as to whether or not this adds to inflation or is a non-event. From our perch, we believe for inflation reasons this is a non-event overall, but for the equity sector energy we do believe this does support a little bit more investment flows back into the energy sector, but most likely later this year. In terms of equity performance since we closed out the first quarter, what's interesting here is the significant rise in the mega technology companies specifically in the United States which did support a big portion of the reason why the S&P finished in second place to Europe as it relates to the overall quarter, but from the standpoint of the last few weeks of March, the US was the number one outperformer in the developed markets largely speaking because of the rise in mega technology names and communication services names. When you step back and look at the first quarter’s performance overall from a sector perspective, what worked last year did not work well in the first quarter and then vice versa - what didn't work last year did work very well in the first quarter of this year most notably because investors believe that as interest rates come down, inflation shows that it is coming down, it is the belief that the high growth sectors are the ones that should outperform if growth indeed is going to be in short supply. We believe overall a diversified exposure to overall sectors is important for all of this year and we believe that industry group and individual company performance is a lot more important than the actual sector performance. We think mega technology names will applaud the rally here, but we think that that rally is likely getting tired as we start to see earnings results come out in the next few weeks. Overall, financials and real estate were the biggest underperformers for obvious reasons in the first quarter. The best start since 2019 is what this year was provided overall for the S&P 500 and typically that has performed well throughout the rest of the year when you have such a strong performance in the first quarter. We believe it's still a grinded out choppy environment overall where on balance you see most of the alpha or excess return at the industry group and individual company level as we're working through what we call the rolling recession. Switching gears over to the banking environment, all eyes have been on deposit inflows and outflows and the good news there - deposit outflows in the small and mid-sized banks have stopped. The Fed liquidity facilities that are available also has not been tapped as much as it did the first two weeks. Overall, what's happening right now is more stability in the banking sector versus instability. This is natural. We expect the next phase of this is now investors are going to hunt around for look alikes. They’re going to hunt around for who has the greatest exposure to the next weak area which most people are pointing to is commercial real estate and in particular, the office side of commercial real estate. The individual small and mid-sized banks have most of the exposure there. That's one of the reasons why although we applaud the stability in the sector, investors are still going to be very fragile on that area because of their significant exposure. Some almost 70% of all commercial real estate loans have been placed out there by the small and mid-sized banks. We'll see how that goes. The message from here is pretty simple - investor sentiment remains very poor, almost close to record levels as it relates to the skittishness on the part of investors but also the fact that the two year yield and under for investors providing significant competitive attractiveness relative to even risk assets. With short rates at 5% or close to it, investors are keeping money on the sidelines, but investors are also hunting for the collateral effects. Overall, what happens when lending standards go up? Tightening lending standards go up, financial conditions tighten, lending velocity goes down, and overall money in circulation goes down. What typically happens there is you get significant slowing of growth, so we do believe that the so-called rolling recession ultimately begins to hit the broader economy some time around the summer months and that will become more visible. Hence our view and our message is very simple – diversification, diversification, diversification. Overall, across sectors, across equity and fixed income we remain neutral on both and we see overall the Fed ultimately cutting by the end of the year. Right now the Fed’s eyes will be on May. We still expect a 25 basis point hike but as slow growth begins to pick up steam in the summer and early fall months, it is likely that the Federal Reserve would cut rates by the end of the year. At least that's what the market’s telling us. Usually what happens in those types of cycles is the first cut is not bought by the investment community. The second and third cuts are bought and that's usually when equities begin to climb the wall of worry again and that should put us back into 2024 in which we see a new long term bull market developing because of earnings and a new profit cycle. That'll do it for today. Thanks for listening.  

Operator:                   Please see the important disclosures provided on this page. 

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