Stock Funds Cling to a 10.3% Gain for 2026

Dow Jones
昨天

To use football terminology, the stock market had a solid first half but struggled to move the ball in the third quarter. Nevertheless, fund investors are in line for a win.

For the quarter, S&P 500-focused funds posted an average total return of 2.2%. But overall U.S.-stock mutual funds and ETFs fell an average 2.4%, to trim their year-to-date gain to 10.3%, according to LSEG statistics. (See Mutual-Fund Yardsticks table.)

International-stock funds were down an average 0.4% for the quarter, to trim the year-to-date return to 10.1%.

The jump in interest rates, and slowdown in the tech-stock bullet train, has put many investors on edge. Highflying stocks like those tied to artificial intelligence "may be vulnerable to a selloff if investors decide they'd rather take advantage of the currently elevated risk-free rates" that Treasurys represent, said Saira Malik, chief investment officer at Nuveen. Treasurys have been pummeled recently, to push up yields-which move on a seesaw compared with prices-to multiyear highs.

"Investors believe the Fed's resolve will ultimately bring inflation under control, which is a precondition for a durable equity rally," said Chris Osmond, chief investment officer for Fifth Third Wealth Advisors.

Bond funds were hammered in the quarter. Funds focused on investment-grade debt (the most common type of fixed-income fund) posted a negative total return of 3.7%, to put the year-to-date gain at 3.0%.

Fund flows

Investors continued to show faith in the stock market in the third quarter, but placed even more faith in the relative comfort of bond funds-despite the recent rout in Treasurys and accompanying jump in yields.

Based on Investment Company Institute estimates, investors added a net $4.3 billion to U.S.-stock mutual funds and exchange-traded funds in the third quarter. They also added a net $15.7 billion to international-stock funds.

However, that stock-fund investing paled in comparison to bond funds. Investors put a net $175.0 billion into bond-focused mutual funds and ETFs in the quarter, according to the ICI estimates.

FINANCIAL FLASHBACK

A look back at Wall Street Journal headlines from this month in history

-- 15 YEARS AGO: Steve Jobs Dies

When Steve Jobs died in October 2011, Wall Street Journal tech columnist Walt Mossberg remarked that he was on par with Thomas Edison or Henry Ford in terms of his impact on business. He wasn't wrong.

Indeed, the Journal gave the Apple legend's death a rare treatment: a six-column headline across the front page.

"Apple has lost a visionary and creative genius, and the world has lost an amazing human being," said his longtime deputy, Tim Cook. "We will honor his memory by dedicating ourselves to continuing the work he loved so much."

That work amounted to a résumé that would rival those inventors and innovators of yore. After co-founding Apple Computer in 1976 and taking its stock public in 1980, Jobs was ousted from the company in 1985 after clashing with its board. But his story didn't end with pioneering the era of personal computing.

After leaving Apple, he founded computer and software company NeXT in 1985 and purchased a small animation studio, Pixar, in 1986. Over the next decade or so, he built the company into a Hollywood powerhouse, including the groundbreaking computer-animated feature movie, "Toy Story."

Then Apple, which was near bankruptcy, called him back in 1997. At the beginning of that phase, the Journal wrote, Jobs described his philosophy as trying to make products that were at "the intersection of art and technology." For his encore performance, he oversaw the launch of the colorful, see-through iMacs and eventually started three new product categories-the iPod in 2001, the iPhone in 2007 and the iPad in 2010.

From the time of his return to Apple until his death, the company became the most valuable in the world, with a market capitalization of $350 billion. It has since gone on to a market cap of nearly $5 trillion, a period mostly run by that former deputy.

-- 60 YEARS AGO: "French Buying of U.S. Gold Came to Halt Last Month"

-- 75 YEARS AGO: "AT&T Gets Millionth Stockholder as Saginaw Family Buys 7 Shares: Company First to Reach Million Mark in Holders"

-- By Simon Constable

 

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