In 2018, no asset category stands out

Making money on investments hasn’t been this hard since Richard Nixon was in the White House.

Market statisticians are falling over one another to describe the pain being felt across asset classes. One venerable shop frames it this way: Things haven’t been this bad since Richard Nixon’s presidency.

Ned Davis Research puts markets into eight big asset classes — including bonds, U.S. and international stocks and commodities. And not a single one of them is on track to post a return this year of more than 5%, a phenomenon last observed in 1972, said Ed Clissold, chief U.S. strategist at the firm.

In terms of losses, investors have seen far worse. But going by the breadth of assets failing to deliver upside, 2018 is starting to look historic.

Nothing’s working, not large or small-cap stocks in the U.S., not international or emerging equities, not Treasuries, investmentgrade bonds, commodities or real estate. Most of them are down, and the ones that are up are doing so by percentages in the low single digits.

That’s all but unique in history. Normally when something falls, something else rises.

Amid the financial catastrophe of 2008, Treasuries rallied. In 1974, commodities were a bright spot. In 2002, it was REITs. In 2018, there’s nowhere to run.

Clissold has a villain: evaporating central bank stimulus.

“Overhanging the markets have been concerns over how asset prices would handle the removal of ultraeasing monetary policies,” Clissold said in a note published last week. During previous instances of market turbulence, “there was a bull market somewhere.”

The Federal Reserve has raised a key interest rate eight times since 2015, and policymakers in Europe and Japan are slowly winding down their accommodative programs. That and global growth concern have soured investor sentiment across the board.

This week, optimism over a temporary trade-war truce between the U.S. and China proved short-lived as concerns from Brexit to a flattening yield curve to a global growth slowdown took hold. Tuesday, the Standard & Poor’s 500 index posted its fifth drop of more than 3% this year.