Sudden Anxiety Spooks Market

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

The U.S. stock market posted its second day of losses, not due to any major market moving news, but because of anticipation of…earnings season.

Earnings season kicks off a week from today (April 11th) and investor sentiment is mixed in its expectations.  Many investors are speculating that Q1 growth will be minimal, but others remain bullish that growth will pick up towards the end of Q2 and ride the wave of solid growth into Q3. As always, we will simply follow the long-term trend, which is currently bullish, but we have no issue with exiting should this bullish signal turn out to be a headfake.

Oil remains as low as it was a year ago and we are still experiencing some currency pressure on the USD as it is presently on a 5-day slide. Both have a formidable impact on the market, so keep an eye on those two indicators and how they correlate to earnings season.

Tesla had a bit of a scare today, but the stock moved higher nonetheless.  Tesla (TSLA) had a hiccup in new vehicle deliveries due to a shortage of parts.  Elon Musk said that it has addressed the delivery shortcomings and assures they will not be repeated when the model 3 sedan hits the market next year.  The company says it is on track to deliver 80,000 to 90,000 new vehicles this year.

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Oil Gets Spanked And Indexes Slip—Domestic Buy Signal Confirmed

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Wall Street kicked off the week to a mediocre start after posting solid gains the week prior.  Better than expected readings on jobs, manufacturing and interest rates were market movers last week.  This week, Wall Street will be focusing more on economic data, such as February factory orders and the March reading on the services sector.

I am still pondering whether the rally since mid-February has real staying power or whether it’s a fleeting bounce that will end with the market reverting back to its early-year downward trend and lead to the first bear market, or 20% drop, since the 2008-2009 financial crisis. While no one has an answer, market action this morning confirmed our “Buy” signal from Friday to start moving back into “broadly diversified domestic equity ETFs/Mutual funds,” a process which I started in my advisor practice this morning.

Again, we will carefully participate in this new cycle with limited exposure to make sure the trend holds before making further commitments.

Crude oil got spanked again as prices dropped 3.78% to close at $35.62 a barrel. Some analysts are now predicting that in the face of the oil glut with storage spaces overflowing, reduced demand and the scheduling of useless OPEC meetings may push oil back into the 20s.

No good news for SunEdison (SUNE) today. The company is bleeding cash and continues to stumble towards an anticipated bankruptcy filing in the near future. Its descent hit top speed in early March when their proposed acquisition of solar company Vivint collapsed after it was not able to secure the financing necessary to seal the deal. The stock now stands at $0.21 a share.

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ETFs/Mutual Funds On The Cutline – Updated Through 04/01/2016

Ulli ETFs on the Cutline Contact

Below are the latest ETF Cutline reports, which show how far above or below their respective long-term trend lines (39 week SMA) my currently tracked ETFs/MFs are positioned.

The first report covers the ETF Master List from Thursday’s StatSheet and includes 381 ETFs, of which currently 246 (last week 176) are hovering in bullish territory.

The second report includes only High Volume ETFs. To clarify, High Volume (HV) ETFs are defined as those with an average daily volume of $10 million or higher. Volume figures can change in a hurry, so be sure to check first before investing.

These ETFs are generated from my selected list of 98 that I use in my advisor practice. It cuts out the “noise,” which simply means it eliminates those ETFs that I would never buy because of their volume limitations. 56 ETFs (last week 44) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 237 (last week 125) above the line and 543 below it out of the 780 that I follow.

Take a look:

  1. ETF Master Cutline Report
  2. ETF High Volume Cutline Report
  3. MF 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.

One Man’s Opinion: Do Investors Need To Be Extra Cautious In The Months Ahead?

Ulli Market Review Contact

ManBond investors need to think in a portfolio context and should not get in and out of bonds in trying to pick the bottoms from the tops, said Jeff Rosenberg, chief investment strategist for fixed income at BlackRock.

The value of US Treasury securities act as a ballast and offsets the risky instruments in a portfolio that investors add for income and capital appreciation. When things go wrong, Treasury securities have demonstrated they can act as ballasts in portfolios, he noted.

While high-grade corporate and government bonds have rallied in recent months, high-yield/junk bonds failed to participate though they have shown signs of improvement. Asked if junk bonds still offer value or if the lack of investor interest is some kind of a signal that risk-aversion is still out there, Jeff said it’s a little bit of both.

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New ETFs On The Block: Janus Small Cap Growth Alpha ETF (JSML)

Ulli Equity ETFs Contact

InvestingSince entering the exchange-traded funds space over a year ago by acquiring VelocityShares, Janus have been steadily expanding fund offerings by launching both equity and fixed-income focused funds. Given Janus’ long history in fundamental factor based investment strategy, the newly-launched so-called Smart Growth equity funds seem long overdue.

The newly launched Janus Small Cap Growth Alpha ETF (JSML) and Janus Small/Mid Cap Growth Alpha ETF (JSMD) target the middle and small capitalization companies and provide exposure to smaller domestic US stocks in a unique way.

Linked to proprietary indices developed in-house, the new funds deploy the firm’s Smart Growth methodology to systematically identify mid- and small-cap companies with the potential for achieving long-term sustainable growth.

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ETF/No Load Fund Tracker Newsletter For April 1, 2016

Ulli ETF Tracker Contact

ETF/No Load Fund Tracker StatSheet

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https://theetfbully.com/2016/03/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-03312016/

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Market Commentary

STOCKS DROP AND POP AFTER STRONG JOBS REPORT

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

On the surface the jobs report was received as a winner with equities tanking at first and then staging their usual comeback with the major indexes closing higher for the week.

While the headline number of 215,000 jobs gained sounded good, almost two-thirds of those continued to be minimum wage jobs just as we’ve witnessed in previous months. On the negative side, some 29,000 manufacturing jobs were lost, the largest monthly drop since 2009.

However, none of these events matter since any kinds of news, good, bad or indifferent, has had the same effect on the markets lately, which is to drive them higher. Even as last month’s lead dog, US oil, got spanked at the tune of some -4.5% today, the S&P 500 decoupled and ended up higher pushing our Domestic Trend Tracking Index (TTI) into “Buy” mode.

See section 3 below for important details.

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