Tech Proves To Be A Drag On The Markets

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com] 

  1. Moving the markets

It’s really no surprise that the best performing sector of 2017 had to eventually come off its lofty levels and back to reality. That moment was today as, despite nine of the 11 S&P sectors gaining, Semiconductors (SMH) took a hit at the rate of -4.24%. Autodesk (ADSK) announced some earnings and restructuring plans that left the tech sector in the dust—at least for the day. However, considering that SMH was up over 45% YTD, a pullback like this had to be expected.

On the other side of the spectrum, the Dow ignored the bad news and sprinted again into record territory, while the S&P was not quite able to climb above the unchanged line. The ETF space affecting our portfolios was mixed and other areas made up for the Nasdaq’s weakness. Leading to the upside were Transportations (IYT) with a chest pounding +3.40% gain, which was followed by the Financials (XLF), which advanced +1.71%. Besides the Semiconductors dropping, we saw Emerging Markets (SCHE) surrendering -1.53%.

Interest rates rose with the yield on the 10-year bond gaining 3 basis points, which was enough to send the price of the 20-year bond (TLT) sharply lower by -0.99%. The effect on the High Yield sector (HYG) was only moderate with a loss of -0.13%. In a repeat from yesterday, both gold and oil slipped again while the US Dollar (UUP) traded in a tight range and ended up giving back -0.04%.

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Shifting Into Overdrive

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com]
  1. Moving the markets

Momentum for equities shifted into overdrive supported by two events. First, Trump’s nominee to run the Federal Reserve, Jerome Powell, testified at a Senate confirmation hearing that “he expects to stay on the course” set by the current Fed chief Yellen. Obviously, these were words that traders wanted to hear and off to the races we went. Second, the Republican tax proposal moved a step closer to a vote in the Senate.

Even geopolitical tensions couldn’t put a damper on the bullish mood and recently recorded records for the indexes were quickly replaced by a new dash into uncharted territory. As a result, green was the favorite color of the day in ETF space. Leading the charge were the Financials (XLF) with +2.60% having its best showing in 8 months. Coming in second and third were Transportations (IYT +1.72%) and US SmallCaps (SCHA +1.44%). Even though the Nasdaq advanced, our winner YTD, namely Semiconductors (SMH), lagged behind with a tiny loss of -0.09%.

The yield on the 10-year bond rose 2 basis points to 2.34%, while the High Yield complex (HYG) calmed down from yesterday’s wild swings and rallied +0.31%. The US Dollar (UUP) showed strength for the second day in a row and added +0.41%. Gold and Oil both slipped immaterially.

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Dow Bucks The Trend As Upward Momentum Slips

Ulli Market Commentary Contact

[Chart courtesy of MarketWatch.com] 

  1. Moving the markets

Right after the opening bell, the major indexes stormed into record territory but succumbed mid-day and turned this session into a non-event with only the Dow clinging on to close in the green. Despite warnings about the market’s lengthy run without a meaningful correction, traders focused on technical factors supporting their bullish view such as that the S&P 500 has been firmly entrenched above its 200-day M/A for the last year. Actually, the last time the S&P came within striking distance of breaking below it was February 2016.

The mixed picture continued in ETF space as well where we saw more losers than winners. Closing barely in the green was the Dividend ETF (SCHD +0.10%) and Aerospace & Defense (ITA +0.06%). On the downside, Semiconductors (SMH) were leading with -1.55% followed by Emerging Markets (SCHE -0.92%) and International SmallCaps (SCHC -0.73%).

While interest rates were mixed most of the action happened in the High Yield market which, after having rebounded the past 6 trading days, showed signs of weakness (higher rates), as HYG headed south again and lost -0.31%. Gold climbed all the way up to $1,299 until manipulation set in, and the yellow metal was pushed down again. The US dollar (UUP) made a V-shape recovery, after early losses, and gained +0.12%.

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One Man’s Opinion: Why Decentralized Trade On The Blockchain Is The Future

Ulli Market Review Contact

By ZeroHedge

 Thanks to the buzz surrounding Bitcoin and blockchain, decentralization as an approach to services is now also being brought to mainstream discussions.

Bitcoin was built as a decentralized currency in the aftermath of the great recession. It was a reaction to the control centralized authorities such as banks have over people’s financial activities. When banks failed, so did the people who entrusted these institutions with their money. Today, Bitcoin continues to reach all-time highs in price. Its value is determined largely by the market and not by some central bank.

If bitcoin can disrupt the current model of currencies, then decentralization should also be applicable to other financial activities such as trade. In the context of trade, marketplaces and exchanges are also mainly controlled by centralized authorities. These companies act as intermediaries connecting buyers and sellers. Parties are allowed to exchange money and goods as long as they follow these companies’ terms and conditions.

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ETFs On The Cutline – Updated Through 11/24/2017

Ulli ETFs on the Cutline Contact

Below please find the latest High Volume ETFs Cutline report, which shows how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs are positioned.

This report covers the HV ETF Master List from Thursday’s StatSheet and includes 366 High Volume ETFs ETFs, defined as those with an average daily volume of more than $5 million, of which currently 266 (last week 263) are hovering in bullish territory. The yellow line separates those ETFs that are positioned above their trend line (%M/A) from those that have dropped below it.

Take a look:

The HV ETF Master Cutline Report            

In case you are not familiar with some of the terminology used in the reports, please read the Glossary of Terms.

If you missed the original post about the Cutline approach, you can read it here.

ETF Tracker Newsletter For November 24, 2017

Ulli ETF Tracker Contact

ETF Tracker StatSheet

https://theetfbully.com/2017/11/weekly-statsheet-etf-tracker-newsletter-updated-11222017/

CLOSING AT NEW ALL-TIME HIGHS

[Chart courtesy of MarketWatch.com]
  1. Moving the markets

Despite this being a Holiday shortened week, 2 of the 3 major indexes (S&P 500 and Nasdaq) managed to close at new records with the S&P booking a gain of +0.9% over the past 4 sessions. Retailers were obviously in focus, but the retail ETF (XRT) closed down -0.43%, however, we will have to wait and see if Black Friday really turns into the game changer the industry has been hoping for.

Across the ETF space, we saw predominantly gains but also some losses. Closing solidly in the green were Semiconductors (SMH +0.83%), followed by International Equities (SCHF +0.73%) and International SmallCaps (SCHC +0.49%). On the downside, we saw Emerging Markets (SCHE -0.28%) and Transportations (IYT -0.05%).

Interest rates were mixed but the 10-year bond yield rose 2 basis points to end the week at 2.34%. Oil rallied, gold pulled back and the US Dollar (UUP) took another dive and gapped down -0.45% to lows last seen in September.

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