MARKETS
- International equity markets continued to outperform U.S. equity markets during the month. The global equity index (MSCI ACWI IMI) increased by +1.04% in December and was up +22.34% in 2025. The S&P 500, which tracks large cap U.S. stocks, increased by +0.06% in December and is up +17.88% for 2025. The Russell 2000 Index, which tracks domestic small cap stocks decreased by -0.58% in December and is up +12.81% for 2025. The International developed equity index (MSCI EAFE) increased by +3.00% in December and is up +31.22% for 2025. The emerging markets index (MSCI EM) increased by +2.99% in December and is up +33.57% for 2025.
- In December, bond yields were mixed across maturities; the 30-year U.S. Treasury bond yield increased by 17 bps to 4.84%, the 10-year yield increased by 16 bps to 4.18%, and the 2-year yield was flat at 3.47%.
- The Barclays U.S. Aggregate Index, which is a measure of U.S. Bond prices, decreased by -0.15% in December and is up +7.30% YTD.
ECONOMIC AND GEOPOLITICAL HEADLINES
- U.S. gross domestic product (GDP) in the third quarter of 2025 increased by 4.3%, according to the “initial” estimate released by the Bureau of Economic Analysis.
- The December Services PMI (formerly Non-Manufacturing Purchasing Managers Index) increased to 54.40% from 52.60% in November. The December Manufacturing PMI decreased to 47.90% from 48.20% in November.
- December non-farm employment increased by 50,000 jobs, and the unemployment rate was little changed at 4.4%, as reported by the Bureau of Labor Statistics on January 9th, 2026. In December employment increased in health care, food services and drinking places, and social assistance. Average Hourly Earnings (wages) increased by 3.8% year-over-year in December.
PERFORMANCE UPDATES
- The Equity Fund increased by +1.16% in December and is up +17.98% for 2025. The Bond Fund decreased by -0.12% in December and is up +6.44% for 2025. The Stable Value Fund was up +0.21% for December and is up +2.43% for 2025. The Northern Trust World Selection Index Fund increased by +1.12% in December and is up +20.34% for 2025.
- The Balanced Fund increased by +0.26% in December and is up +13.70% for 2025. The Target Annuitization Date TAD 2025; TAD 2030; TAD 2035; TAD 2040 TAD 2045 and TAD 2050 returns were +0.34%, +0.45%, +0.59%, +0.70%, +0.81% and +0.90% respectively for December and +6.33%, +10.24%, +12.67%, +13.78%, +14.69% and +15.56% for 2025.
