Once again, major market ETFs ended up in the green despite continuing concerns about Europe. Although not a big day by any means as the S&P 500 only rose 0.23%, we’ve seen significantly lower levels of volatility in the market.

Without these large swings that were relatively commonplace in October and November last year, it’s certainly a better time to add some equity exposure, albeit minimal. For instance, this can be done via sector ETFs with favorable momentum figures that are less sensitive to market fluctuations.

Nevertheless, a 10-year Treasury yield below 2% and elevated yields for European bonds (i.e. Spain, Italy) serves as a stark reminder that the risk perception in the market is high. The trend of flight to safety hasn’t abated one iota.

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It was quite a flat day to say the least as the S&P 500 nudged up a mere 0.03%. Volatility is still quite low, so it will be a guessing game as to when/if the big drop comes especially with Greece’s fate to be decided soon.

While equity ETFs didn’t move all that much, gold hit a 1-month high. Some of the major banks predict gold will hit above $2,000, but that will likely depend on risk perception and how the dollar performs.

But risk perception was ever apparent as the Euro remained depressed at $1.27/Euro while 10-year Treasury yields dropped down to 1.90%. After Germany and the U.K. issued bonds with negative yields, investors will surely be looking for other places to park their money to earn at least a marginally positive return. Something is certainly better than nothing.

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Despite continuing concerns surrounding Europe, the S&P 500 rose 0.89% while European and Asian indices also posted large gains. Meanwhile, the 10-year Treasury yield went up as did commodity prices.

However, the Euro moved very little against the dollar, sticking to $1.28/Euro. The trend of record high deposits at the ECB despite new liquidity measures highlights the frailty of the financial system, which can’t be ignored.

Yesterday, I mentioned that it might be an appropriate time to gain some equity exposure especially with minimized volatility. Given some of the upward momentum, as the S&P 500 is above its long-term moving average, taking on equity ETFs very selectively can reap some benefits. Yet, the level of uncertainty that exists in markets serves a reminder that a big drop can happen at any time.

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Keeping in sync with the flatness towards the end of last week, markets didn’t move all that much as U.S. indices, Treasuries, and commodities minimally fluctuated. Volume remained relatively thin as the S&P 500 slightly edged up 0.22%.

Though markets are caught in a state of flux, the Euro remains weak against the dollar at $1.28/Euro, highlighting that Eurozone problems are still front and center.

Volatility has been down as of late, questioning whether it makes sense to gain some equity exposure. For those wishing to make some equity ETF additions, now might be an opportune time. If you do, keep your risk tolerance in mind and don’t forget that we’re still very much in bear territory when it comes to international ETFs.

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