Global equities reached record highs during the third quarter as earnings growth offset pressure from higher oil prices and rising interest rates following a sharp bond-market sell-off. Inflation concerns intensified as energy costs rose amid the ongoing conflict in the Middle East, pushing U.S. 10- and 30-year Treasury yields to levels not seen since the early 2000s. The Northern Trust All Funds Over $100 Million plan universe reported a median return of 0.04% for the quarter.

The Northern Trust Universe tracks the performance of 362 large U.S. institutional investment plans, with combined assets of approximately $1.6 trillion, which subscribe to performance measurement services as part of Northern Trust’s asset servicing offerings.

Results varied across major institutional plan types during the quarter. The Northern Trust Corporate (ERISA) universe returned -3.7% at the median, while the Northern Trust Public Funds universe reported a –0.1% median return, and the Northern Trust Foundations and Endowments (F&E) universe posted a 0.7% median return.

Large-cap equities reached record highs, led by energy and artificial intelligence-related stocks, as earnings growth persisted despite higher financing costs. The S&P 500 returned 2.3% for the quarter and 15.7% for the one-year period, compared with median returns of 1.0% and 14.8%, respectively, for the Northern Trust U.S. Equity Program universe. The universe’s median three- and five-year returns were 20.3% and 11.0%, trailing the S&P 500’s corresponding returns of 22.9% and 13.8%. The Russell 1000 Value Index returned 2.6%, outperforming the Russell 1000 Growth Index’s 0.9%, while the Russell 2000 Index declined 7.2%.

Nadia Cobalovic, global head of Integrated Portfolio Services at Northern Trust Asset Servicing, said: "The third quarter highlighted the different ways institutional portfolios respond to changing market conditions. Higher interest rates weighed on fixed income and some equity segments, while strong corporate earnings and continued momentum in select sectors supported broader equity markets. The dispersion in returns across institutional plan types reflects the impact that asset allocation decisions can have during periods of heightened volatility."

In September, the Federal Reserve raised the federal funds rate by 25 basis points to a target range of 3.75% to 4.00%, citing persistently high inflation and continued strength in the economy and labor market. Against this backdrop, the Northern Trust U.S. Fixed Income universe posted median returns of -3.5% for the quarter and -1.3% for the trailing 12 months, compared with -3.5% and -1.8%, respectively, for the Bloomberg U.S. Aggregate Bond Index.

ERISA plan one, three, and five‑year median returns were 1.8%, 8.4% and 1.4%, respectively. Fixed income remained the largest asset class, with a median allocation of 54%, although dispersion across plans continued to widen. Top-quartile plans allocated more than 70% to fixed income, compared with less than 20% among bottom-quartile plans.

Public Funds universe median returns for the one, three, and five‑year periods were 9.3%, 12.0% and 6.5%, respectively. Plans maintained significant public-market exposure, with median allocations of 29% to U.S. equities and 22% to U.S. fixed income.

In the Foundations & Endowments universe, median one, three, and five‑year returns stood at 11.1%, 13.4% and 7.0%, respectively. Plans maintained substantial equity exposure, with median allocations of 26% to private equity and 17% to U.S. public equity, while the median fixed-income allocation remained below 10%.

About Northern Trust

Northern Trust Corporation (Nasdaq: NTRS) is a leading provider of wealth management, asset servicing, asset management and banking services to corporations, institutions, affluent families and individuals. Founded in Chicago in 1889, Northern Trust has a global presence with offices in 24 U.S. states and Washington, D.C., and across 22 locations in Canada, Europe, the Middle East and the Asia-Pacific region. As of September 30, 2026, Northern Trust had assets under custody/administration of US$19.9 trillion, and assets under management of US$2.0 trillion. For more than 135 years, Northern Trust has earned distinction as an industry leader for exceptional service, financial expertise, integrity and innovation. Visit us on northerntrust.com. Follow us on Instagram @northerntrustcompany or Northern Trust on LinkedIn.

Northern Trust Corporation, Head Office: 50 South La Salle Street, Chicago, Illinois 60603 U.S.A., incorporated with limited liability in the U.S. Global legal and regulatory information can be found at https://www.northerntrust.com/terms-and-conditions.

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The Northern Trust Universe tracks the performance of 362 large U.S. institutional investment plans, with combined assets of approximately $1.6 trillion, which subscribe to performance measurement services from Northern Trust Asset Servicing.