Monday, March 19, 2018

Full of Surprises

Monday, March 19, 2018 - When it comes to upsets, the NCAA basketball tournament isn’t the only game in town this month – the market has produced its share of surprises as well. This volatility is likely to be the norm moving forward, as market influences have caused sentiment to swing widely between enthusiasm and caution.

Fears of heightened global trade tensions appeared to be the main factor weighing on sentiment early last week. Investors continued to worry about trade retaliation following the previous week’s announcement of new U.S. tariffs on steel and aluminum imports, but major trading partners in Asia and Europe appeared to be taking a cautious approach.

Markets were further unsettled by the dismissal of Secretary of State Rex Tillerson, widely considered to be a free trade advocate within the administration. Also worrisome were what appeared to be reports that President Trump had requested the preparation of a package of tariffs targeting China. The standout event next week will be the Federal Reserve's interest rate decision. While the Fed is expected to raise short-term interest rates, investors will focus on the additional information regarding the number of rate hikes it expects for the remainder of the year.

Last week added to March’s unexpected volatility, with the Dow Jones Industrial Average moving by more than 100 points each day. Stocks fell modestly for the week after a Friday rally broke a four-day losing streak for the Standard & Poor's 500 Index and partially compensated for earlier losses. Small and Mid-Caps fared better than Large-Caps. Within the S&P 500, Utilities and Real Estate sectors saw gains, helped by a decline in longer-term Treasury yields, which in comparison make their healthy dividend payments more attractive. Conversely, the much larger Financials sector, which sees lending profits squeezed by lower interest rates, was among the market’s weaker segments. Materials also performed poorly.

ETFG Quant Movers – As expected this week in the ETF Global Quant Movers, iShares Core S&P Mid-Cap ETF (IJH), Vanguard Russell 2000 (VTWO) and Schwab U.S. Mid-Cap ETF (SCHM) saw the biggest gains of 18.26%, 16.94% and 16.77% respectively in their Quant Total Score.

Losers for the week included PowerShares India Portfolio (PIN), Global X Next Emerging & Frontier ETF (EMFM) and SPDR S&P Oil & Gas Exploration & Production ETF (XOP) dropping 16.50%, 14.99% and 14.30% respectively.

Thank you for reading ETF Global Perspectives!

ETFG 21 Day Free Trial:

Assumptions, opinions and estimates constitute our judgment as of the date of this material and are subject to change without notice.  ETF Global LLC (“ETFG”) and its affiliates and any third-party providers, as well as their directors, officers, shareholders, employees or agents (collectively ETFG Parties) do not guarantee the accuracy, completeness, adequacy or timeliness of any information, including ratings and rankings and are not responsible for errors and omissions or for the results obtained from the use of such information and ETFG Parties shall have no liability for any errors, omissions, or interruptions therein, regardless of the cause, or for the results obtained from the use of such information. ETFG PARTIES DISCLAIM ANY AND ALL EXPRESS OR IMPLIED WARRANTIES, INCLUDING, BUT NOT LIMITED TO ANY WARRANTIES OF MERCHANTABILITY, SUITABILITY OR FITNESS FOR A PARTICULAR PURPOSE OR USE.  In no event shall ETFG Parties be liable to any party for any direct, indirect, incidental, exemplary, compensatory, punitive, special or consequential damages, costs, expenses, legal fees, or losses (including, without limitation, lost income or lost profits and opportunity costs) in connection with any use of the information contained in this document even if advised of the possibility of such damages.

ETFG ratings and rankings are statements of opinion as of the date they are expressed and not statements of fact or recommendations to purchase, hold, or sell any securities or to make any investment decisions. ETFG ratings and rankings should not be relied on when making any investment or other business decision.  ETFG’s opinions and analyses do not address the suitability of any security.  ETFG does not act as a fiduciary or an investment advisor.  While ETFG has obtained information from sources they believe to be reliable, ETFG does not perform an audit or undertake any duty of due diligence or independent verification of any information it receives.

This material is not intended as an offer or solicitation for the purchase or sale of any security or other financial instrument. Securities, financial instruments or strategies mentioned herein may not be suitable for all investors.  Any opinions expressed herein are given in good faith, are subject to change without notice, and are only correct as of the stated date of their issue.  Prices, values, or income from any securities or investments mentioned in this report may fall against the interests of the investor and the investor may get back less than the amount invested.  Where an investment is described as being likely to yield income, please note that the amount of income that the investor will receive from such an investment may fluctuate.  Where an investment or security is denominated in a different currency to the investor's currency of reference, changes in rates of exchange may have an adverse effect on the value, price or income of or from that investment to the investor.

No comments:

Post a Comment

Note: Only a member of this blog may post a comment.