Stock prices continued their remarkable ascent from the March pandemic low, shaking off a rise in new COVID-19 cases and a heated political environment to finish the third quarter near all-time highs.

As we pass the six-month mark since the U.S. COVID-19 lockdowns, we reflect upon recent and potential long-term changes in consumer spending trends.

Markets grinded higher in the third quarter. Strength was broad-based amongst sectors and geographic regions. In this environment, growth stocks outperformed substantially relative to value stocks.

Baird Funds Senior Portfolio Managers Duane McAllister, CFA, and Lyle Fitterer, CFA, provide insight into how staying with municipals can provide resiliency through uncertainty.

Baird Advisors Managing Director and Chief Investment Officer Mary Ellen Stanek, CFA, and Dan Clifton, partner and head of policy research at Strategas, discuss potential implications of the upcoming election and its impact to the financial markets.

As stay-at-home restrictions eased across the country during the second quarter and consumers and businesses started to resume normal activities, equity prices quickly began discounting a recovery.

Markets rallied vigorously in the second quarter. The increase in risk sentiment was considerable. Positive stock performance was broad-based, with all sectors and regions benefitting.

In our latest whitepaper our investment team provides insights into why it’s important to maintain a high-quality bias in the municipal market until the outlook is more certain.

Much will be written about the first quarter of 2020, which was unprecedented in most every way.

At the time of this writing, most of the nation is locked down with shelter-at-home orders as we approach in the coming weeks what we hope to be the peak of the COVID-19 outbreak in the United States.

This was an extraordinarily challenging quarter for all market participants. In this letter, we discuss the nature of our performance and provide our investment outlook.