The typical corporate U.S. defined benefit pension plan's funding ratio rebounded in July, increasing 2.9 percentage points to 76.9%, according to an analysis by BNY Mellon Asset Management.
The increase was a result of strong performance by U.S. and international stocks, according to a BNY Mellon news release. For the month, U.S. stocks were up 6.9% and international stocks returned 9.5%, largely a result of the strengthening euro, according to the release.
Assets for the typical U.S. corporate pension plan increased 4.8% in July. The Aa corporate discount rate dropped slightly to 5.29% for the month from 5.34% in June, increasing liabilities by 0.9%.
“The July rebound in equities provided much-needed relief for pensions that had suffered through three consecutive months of falling assets and declining funded status,” Peter Austin, executive director of BNY Mellon Pension Services, said in the news release. “Despite the strong July performance of the equities markets, the funded status for the typical plan is still 6.6 percentage points lower than it was at the beginning of 2010.”
Mr. Austin could not be reached for further comment.