Quarterly Commentary, Q1 2026

January and February were steady and constructive. The economy was growing, inflation continued to ease, and markets moved higher with a generally positive tone.

March was different. Escalation in the Iran conflict drove oil prices higher and introduced uncertainty, which led to a market pullback and increased volatility. Markets gave back earlier gains and finished the quarter flat to modestly lower.

The S&P 500 finished down 4.33%, the Russell 2000 was a positive 0.89%, while international markets (EAFE) were down 1.24%, and Emerging Markets declined 0.17%. Bonds finished flat for the quarter, while shorter-term U.S. Treasuries were up 0.88%. Oil was a bright spot as demonstrated by the Vanguard Energy ETF, which was up 38.19% in the quarter. Our portfolios, with a value focus and a significant allocation to energy stocks, benefited from this positioning and saw a positive contribution to performance. The Russell 1000 Value was up 2.10%, while the Russell 2000 Value was up 4.96%.

Several key themes emerged during the quarter. The economy is showing remarkable resilience, posting solid growth in the 3% range. Inflation is easing gradually, though energy prices are starting to feed through the supply chain. Interest rates are up modestly, creating better income opportunities. Short-term volatility, as we saw in March, is normal. As a reminder, markets experienced a nearly 20% sell-off following last April’s trade tariff announcement, only to rebound strongly and finish the year with mid-teen gains.

As of quarter-end, it appears the U.S. administration is focused on ending the conflict with Iran. If we see follow-through, this could be positive for markets, even without the Strait of Hormuz fully open. Anytime uncertainty is reduced, the markets tend to react positively. We will see how this plays out.

For us at Resource Consulting Group (RCG), we continue to stay the course and do not typically make changes due to short-term spikes in volatility. We focus on reasonably priced companies while we underweight more expensive and unprofitable ones. Our diversification helps to reduce volatility with positions in over 18,000 companies globally. The fixed income is mostly in U.S. Treasuries with shorter duration, a historically reliable, conservative philosophy, and a bright spot in bonds this quarter. Importantly, we avoid reacting to short-term headlines and geopolitical events.

While the quarter ended on a softer note, the bigger picture hasn’t changed. Markets moved quickly in March, but that is part of investing. Staying patient and disciplined, particularly during periods like this, has historically supported better long-term outcomes. We remain confident in our approach.

As always, we are here to help you navigate these markets. Please reach out to your RCG advisor if you have any questions or would like to discuss your investments further.