Weekly Market Update: 20 August 2010

The Economy

• Global economic data was still disappointing overall, which is in line with our view of a slow-growth environment waiting for a positive catalyst.
• U.S. manufacturing activity experienced deterioration, as reflected in lower numbers for the Empire State Manufacturing Survey as well as the Philadelphia Fed manufacturing index.
• The U.S. Producer Price Index was in line with expectations, gaining 0.2% and staving off fears of possible deflation.
• The U.S. housing market showed weaker results, as the National Association of Home Builders/Wells Fargo index fell to its lowest level since March 2009.
• U.S. initial jobless claims grew unexpectedly to 500,000 for the week ending August 14.
• Retail sales in the U.K. rose 1.1% in July, nearly three times the pace of predictions. Items such as jewellery and sporting goods led the way, with a further boost from online sales.
• German investor confidence (as measured by the ZEW Index) fell to a 16-month low in August, signalling a slower pace of economic recovery

Economic Calendar

• The Chicago Fed National Activity Index will be released August 23.
• Existing home sales and the Richmond Fed Manufacturing Index will be released August 24.
• Durable-goods orders, capital goods and new home sales will be released August 25.
• Initial jobless claims and continuing claims will be released August 26.
• Gross domestic product, personal consumption and the University of Michigan consumer confidence survey will be released August 27.

Stocks

• Global equity markets were slightly positive, led by emerging markets, as investors faced fears about ongoing sluggish growth in developed markets.
• In the U.S., value stocks outperformed their growth counterparts, and small-cap stocks outperformed their large-cap brethren. Information Technology performed best, while Energy performed worst.
• In the U.K., Information Technology was the only sector to outperform the broader market for the week. Energy, Telecommunications and Utilities struggled in particular.
• In Europe, Information Technology and Consumer Discretionary outperformed the broader market, while all other sectors lagged. Financials and Energy performed worst.

Bonds

• Global bond markets continued to be positive, with emerging-market debt performing best on better financial situations in comparison to their developed peers.
• Investors preferred bond markets in general, searching for coupon income amid uncertainties surrounding equities. Both government and corporate bond markets had positive returns.
• High-yield bonds (which are rated below investment grade and considered to be riskier) underperformed the broader bond market.

Index returns are for illustrative purposes only and do not represent actual fund performance.

Index performance returns do not reflect any management fees, transaction costs or expenses. Indexes are unmanaged and one cannot invest directly in an index. Past performance does not guarantee future results.

Diversification may not protect against market risk. There are risks involved with investing, including loss of principal.

This material represents an assessment of the market environment at a specific point in time and is not intended to be a forecast of future events, or a guarantee of future results. This information should not be relied upon by the reader as research or investment advice. This information is for educational purposes only.

SEI Investments Management Corporation (SIMC) is the adviser to the SEI Funds, which are distributed by SEI Investments Distribution Co (SIDCO). SIMC and SIDCO are wholly owned subsidiaries of SEI Investments Company.

To determine if the Fund(s) are an appropriate investment for you, carefully consider the Fund’s investment objectives, risk factors and charges and expenses before investing. This and other information can be found in the Fund’s prospectus, which can be obtained by calling 1-800-DIAL-SEI. Please read it carefully before investing.