Monday, May 18, 2020

What Will Reopening Really Bring?

Monday, May 18, 2020 - Stocks recorded their biggest, weekly percentage drop in nearly two months last week, a sign that recent gains are just one step of what many analysts say will be a long and painful recovery.

While many investors remain hopeful that stimulus measures from central banks and governments will ease pressure on the world economy, there is growing belief that the fallout from the coronavirus pandemic will last longer than anticipated. Fueling the caution: the prospect that lockdowns could linger or stimulus measures could prove insufficient to keep pace with job losses and business closures.

The S&P 500 fell 2.3% last week, recording its biggest weekly drop since the extreme volatility of mid-March. Stocks have bounced 28% above their multiyear lows from that month but remain 15% below their February records.

ETFG Equity Exposure Report - Microsoft, UnitedHealth launch coronavirus screening app. The ProtectWell app from Microsoft (NASDAQ:MSFT) and UnitedHealth Group (NYSE:UNH) lets companies screen employees daily for potential coronavirus symptoms and directs the worker to be tested, if necessary. The app, available free for U.S. employers, also includes resources and guidelines for worker testing schedules based on their level of potential exposure. ProtectWell doesn't provide tracking and contact tracing information, standing apart from the efforts of Apple and Google. UnitedHealth is in charge of the included healthcare data. The ETFs weighted most heavily with Microsoft Corp. stock are the SSgA Technology Select Sector SPDR (XLK), the iShares Russell Top 200 Growth ETF (IWY), the Vanguard Information Technology ETF (VGT), the Fidelity MSCI Information Technology Index ETF (FTEC) and the iShares Global Tech ETF (IXN).

ETFG Quant Movers - This week, something different, as we are highlighting the ETFs that saw the largest movement in our ETFG Quant Behavioral Score.

ETFG Quant Winners: The ETFs with the biggest percentage increase in their ETFG Quant Behavioral Score this week were the Innovator IBD ETF Leaders ETF (LDRS), the Fidelity International Value Factor ETF (FIVA), the iShares MSCI Poland ETF (EPOL), the iPath S&P MLP ETN (IMLP), and the JPMorgan Long/Short ETF (JPLS).

ETFG Quant Losers: The ETFs with the biggest percentage decrease in their ETFG Quant Behavioral Score this week were the First Trust Preferred Securities and Income ETF (FPE), the CSIM Schwab Fundamental Emerging Markets Large Company Index ETF (FNDE), SPDR Solactive Japan ETF (ZJPN), the SPDR Solactive Germany ETF (ZDEU) and theALPS Sector Dividend Dogs ETF (SDOG).

ETFG Weekly Select List - The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.

This week we are focusing on Alpha-Seeking strategies as investors may be leaning away from passive investing and looking at ways to generate performance based on risk/return metrics. The 5 ETFs with the highest Alpha-Seeking ratings from our ETFG Quant model include: the Validea Market Legends ETF (VALX), the Invesco S&P Spin-Off ETF (CSD), the Invesco Raymond James SB-1 Equity ETF (RYJ), the Invesco BuyBack Achievers ETF (PKW) and the Cambria Shareholder Yield ETF (SYLD).

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