New ETFs On The Block: JP Morgan Diversified Return Europe Equity ETF (JPEU)

Ulli Europe Contact

91551519JP Morgan Asset Management, the mutual and exchange-traded funds unit of JP Morgan Chase & Co, added the fifth ETF to its portfolio with the launch of JP Morgan Diversified Return Europe Equity ETF (JPEU).

The JPM Diversified Return ETF series are strategic beta funds that seek to improve risk-adjusted returns of diversified portfolios. Each fund is based on a FTSE Diversified Factor index designed to exclude low-quality and expensive stocks. The previous four funds seek to provide exposure in the US, global, international and emerging markets.

JPEU, as the name suggests, targets European companies and tracks the FTSE Developed Europe Diversified Factor Index, which is a subset of the larger FTSE Developed Europe Index comprising of large– and mid–cap stocks. The underlying index, co-developed by JPM with FTSE, is re-balanced quarterly and uses liquidity criteria along with JPM’s active insights and risk-management expertise.

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ETF/No Load Fund Tracker Newsletter For February 12, 2016

Ulli Market Commentary Contact

ETF/No Load Fund Tracker StatSheet

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THE LINK TO OUR CURRENT ETF/MUTUAL FUND STATSHEET IS:

https://theetfbully.com/2016/02/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-02112016/

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Market Commentary

EQUITIES AND CRUDE REBOUND SHARPLY BUT END UP DOWN FOR THE WEEK

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

The wild ride continued on Wall Street as crude oil finally found some footing and sparked a 12% surge on Friday, which was its best session gain in 7 years. Still, for the week, oil ended up over 8% lower than it started.

Oil’s rebound pulled equities out of the basement but the rally was not sufficient to wipe out earlier losses and the indexes closed lower for the week as the chart above shows.

Powering crude oil was continued speculation that major producers are considering the “possibility” of a coordinated effort to cut crude output. Well, we’ve heard that theme before with the result that it was later denied and oil shifted sharply into reverse taking equities down with it. Maybe, this time it’s different?

All of our 10 ETFs in the Spotlight participated and closed solidly in the green for today. The leader was the Financials (IYF) with +3.54% while the Dividend ETF (DVY) showed a more modest gain of +1.14%.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 02/11/2016

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, February 11, 2016

TOC010716

If you are not familiar with some of the terminology used, please see the Glossary of Terms.

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: SELL — since 11/13/2015

TTI

Our main directional indicator, the Domestic Trend Tracking Index (TTI-green line in above chart) has recently crawled above its long term trend line (red) and finally generated a new “Buy” signal effective 11/3/15. The market subsequently dropped, and we exited again on 11/13/15. As of today, the TTI remains below its trend line by -3.84%, which means we are in cash on the sidelines.

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OPEC Rumor Keeps Markets From Crashing

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Sure, when all else fails to prop up the markets, start a rumor. Just as the S&P dipped towards the psychologically 1,800 level, the WSJ reported that the OPECers were “ready to cooperate” on a production cut.

That’s all it took, and the indexes staged their typical afternoon rally which, however, petered out but the losses of the day were cut by about 1%. Not helping the mood on Wall Street were Fed chief Yellen’s remarks during her second day of testimony, which lacked “hope” for the markets that interest rates might be cut.

All risk assets got slammed, and the clear winner of the day was gold, which rallied +4.3% while government bonds surged.

All of our 10 ETFs in the Spotlight succumbed to bearish forces and closed down. Faring the worst was the Financial ETF (IYF), which got clobbered at the tune of -2.66%. Resisting the sell-off the best was the Consumer Discretionary ETF (XLY) with -0.06%.

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Smashing Exuberance

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

There was much hope of the Fed showing signs of not only relenting from their planned interest rate hikes in 2016 but possibly shifting in reverse and lowering rates in the very near future.

Such was the anticipation as Fed chief Yellen delivered testimony in front of a congressional committee, which also had the opportunity to participate in a Q&A session. While equities displayed some exuberance early on, the major indexes slid in the afternoon as it became clear that no assist to push stocks out of their doldrums was forthcoming.

Yellen said that financial conditions “have become less supportive to growth” and “downside risks” are largely stemming from uncertainty over the state of the Chinese economy. In the end, Yellen left the door wide open as to further rate increases in 2016. To me, that means that equities have to find another driver to push prices higher as the Fed, at least for the time being, is not showing an accommodative stance.

With the markets ending basically unchanged, only 3 of our 10 ETFs in the Spotlight made a dash above the unchanged line led by Healthcare (XLV) with +0.87%. On the downside, the Select Dividend ETF (DVY) lost -0.38%.

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Oil Dumps; Major Indexes Seesaw

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Today was repeat of yesterday’s session in that markets sold off most of the day but managed a better recovery during the last hour by closing only slightly below the unchanged line. Apparently the bulls are still alive and putting up a fight during these tug-of-war sessions.

The energy sector ended up being the worst performer, followed by telecommunications and financials. The tech sector rallied early on but lost its momentum as the FANG stocks (Facebook, Amazon, Netflix and Google) got spanked again for the second day in a row with Netflix being the only gainer for the day.

At the open, the domestic markets had to live with the fact that the Nikkei Average had lost 5.4%, its biggest decline since 2013 while the 10-year Japanese bond yield fell below zero for the first time. Much of the focus is on Asia this week (with China being closed), however, let’s not forget the banking debacle in Europe where some of the Italian banks are suffering from a constantly increasing amount of NPLs (Non Performing Loans).

Not to be outdone, Deutsche Bank (DB), the German behemoth with over $60 trillion in derivatives, is in dire straits and has been in the cross-hairs for all kinds of trouble while its stock price has dropped to records lows. Some have compared DB to having a “Lehman moment,” a reference to the firm that brought about the 2008 financial crisis.

4 of our 10 ETFs in the Spotlight ended up on the plus side, while 6 of them dropped below the unchanged line. Leading the charge was Healthcare (XLV) with +0.74% while the Global 100 (IOO) was the loser of the day with -0.71%.

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