Foreign and domestic stock funds earned moderate returns in October, helping to remove some of the stigma of the disaster month. While tempered by the uncertainty of the midterm elections, the market cheered strong corporate-earnings results and the likelihood that the Federal Reserve will flush more cash into the financial system and keep long-term interest rates low. World equity funds rose 3.8% and 9.35% over those periods. Bond funds were mixed, with long-term Treasury funds down, high yield corporates up 2.5% and A-rated corporates bonds up 0.05%.
The Dow Jones U.S. Total Stock Market Index gained 3.8% in October, rising three of the past four months. It's up 7.2% year to date. Meanwhile, yields on 10-year Treasuries dipped below 2.5% in October, making dividend yields on stocks look more appealing.
With nearly seven in 10 S&P 500 companies having reported third-quarter results, earnings grew 30% year over year.
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