The markets gyrated all over in July, but the Dow Jones Industrial Average managed to add a small gain for the month. The Dow Jones Industrial Average gained 0.43% for the month and is off (13.03%) year-to-date. The S&P 500 lost (0.84%) and is off (12.66%) year-to-date. The NASDAQ gained 1.42% for July and has lost (12.32%) year-to-date.

The value style beat the growth style across all capitalizations for the month. The Russell 1000 Value Index lost (0.36%) while the Russell 1000 Growth Index lost (1.90%). The Russell 1000 Growth Index is leading the Russell 1000 Value Index year-to-date; (10.79%) versus (13.88%). The financial sector rebounded slightly in July, which caused the Russell 1000 Value Index to outperform.

Small cap stocks did well during the month, especially small cap value. For the month of July, the Russell 2000 Index gained 3.70%, and the Russell 2000 Value gained 5.13%. Year-to-date, small caps are outperforming large caps, and the Russell 2000 Value Index is the leading index, down (5.27%).

The international markets performed worse than our domestic markets. The MSCI-EAFE Index lost (3.28%) and is down (15.56%) year-to-date. The Emerging Markets Index lost (4.16%) for the month and is off (16.36%) year-to-date. Some of the hot foreign markets such as China are down 50% from their highs of last year.

The bond market was flat to down for the month, but slightly positive year-to-date. The Lehman Brothers Aggregate Index lost (0.08%) for the month and is up 1.04% year-to-date. The fears of inflation and the weak dollar are worrying investors that the next move by the Fed will be to raise interest rates. Cash continues to be one of the better asset classes in 2008. T-bills with their steady positive returns each month are compounding at a positive 1.8% annual return.