Sit Investment Associates provides quality investment management expertise in domestic and international growth equities and fixed income. Investment management services are offered across four channels: Separate Accounts, Private Investment Funds, Collective Investment Funds, and Mutual Funds. We take pride in serving as a true extension of our clients’ operations, providing highly individualized service in an increasingly challenging economic and financial environment.

We view investing as the practice of applying a consistent philosophy and decision-making process over meaningful time periods. In fact, the firm’s success is built on long-term client relationships, which in turn are built on a foundation of trust, commitment, understanding, and expertise.

The firm is owned by its seasoned investment professionals, who work hands-on in every aspect of the investment process and client service. We are 100 percent committed to achieving clients’ investment objectives, because our clients’ success results in our success.

Market Commentary

January 10, 2022

S&P 500 earnings are projected to rise about +8.0 percent in 2022, on par with the previous 20-year average. We anticipate the combination of decelerating corporate earnings growth and modestly lower valuations due to tighter monetary policy will result in lower overall equity returns in the year ahead.  In addition, market volatility may rise given the numerous crosscurrents (e.g., Covid trends, interest rates, geopolitics). However, in our view, companies with pricing power will continue to prosper, even if inflation pressures begin to moderate in some areas. Together, these conditions point to an opportunity for stock picking as company fundamentals become paramount after the powerful liquidity backdrop that “lifted all boats” for most stocks over the past two years. Specifically, we expect earnings growth to be the key determinant of stock and sector performance in the year ahead.

We believe core PCE inflation will progressively lessen in 2022 against challenging year-over-year comparisons but remain above the Federal Reserve’s targeted +2.0 percent entering 2023. Nonetheless, the global spike in Covid-19 infections has added considerable uncertainty to the supply-demand outlook and its effect on inflation near term. Ultimately, we anticipate easing supply constraints and subsiding demand growth to lead to goods disinflation/deflation, with services inflation, notably that driven by housing, a partial offset. Still, tightening U.S. labor conditions could trigger a wage-price spiral and persistent inflation absent higher productivity.

For our latest full Global Investment Outlook & Strategy Update, download the .pdf document.