The equity markets accelerated lower in the third quarter of 2008 as it appears that investors continued to see that a deepening real estate/credit crisis and weaker corporate revenues will reduce company profitability in the future. The small capitalized stocks outperformed larger and middle capitalized stocks as investors saw better value in the beaten-down small cap stocks. The S&P 600 Small cap Index had a 0.855% loss while the S&P 500 Index was down this quarter by 8.4% and the S&P Mid Cap 400 Index posted a 10.87% loss. Value stocks outperformed in the growth stocks in all capitalization ranges. The Consumer Staples sector was the best performing S&P 500 sector with a 4.1% quarterly gain and the Energy sector was the worst performer, down 24.95%.

International stock indices performed similar to the U.S. equity markets for the quarter. The broad MSCI AC World ex US Net index had a total return of -15.0%, while the MSCI EAFE Index (Europe, Australasia and the Far East) had a -14.5% return. Emerging markets performed worse than the developed markets with the MSCI Emerging Market Free Net Index was down 17.5% for the quarter.

Real Estate Investment Trusts (REITS) rose as investors sought to pick up bargains in the troubled real estate sector. The S&P REIT Composite was up 5.25% last quarter.