ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2015/12/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-12172015/

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Market Commentary

EQUITIES GET SPANKED BY SLIDING CRUDE PRICES AND OPTIONS EXPIRY

 [Chart courtesy of MarketWatch.com]

1. Moving the Markets

One look at the above chart tells the story. The euphoric “Fed High” did not last, the morning after hangover sat it in and the major indexes took a steep dive over the past 2 days closing the week lower but not by much. The S&P and Dow had their worst 2-day performance since September 1.

The culprits to this week’s debacle were the usual suspects: The continued swoon of oil prices, what the Fed’s announcement really means, a weakening global economy and the event du jour was quadruple options expiration day. The chart definitely resembles a black diamond slope with the indexes closing at their lowest point of the day, which may not bode well for Monday’s opening.

With the holidays upon us, I expect volume to slow down, and it remains to be seen if that might contribute to a Santa Claus rally next week.

All of our 10 ETFs in the Spotlight headed south as equities got hammered. The surprising leader to the downside was the conservative Consumer Staples ETF (XLP) with -2.49%, while the Mid-Cap Value (IWS) was the best performer with a loss of “only” -1.48%.

Our bearish outlook was confirmed again, as section 3 below shows, and a 100% cash position is my preferred choice.

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1. Moving the Markets

Heading into decision day for the Fed, skeptics warned that an increase in rates could cause market volatility and upheaval. Well, the exact opposite happened today as it seems that Wall Street bulls viewed the Fed’s rate hike as a sign of an improving economy. The question in my mind is as to whether this euphoric reaction represents simply a relief rally or the continuation of the bullish trend. We’ll have to be patient and give it a little time to see if upward momentum can be maintained.

The Fed delivered the news in a policy statement, which read: “Given the economic outlook, and recognizing the time it takes for policy actions to affect future economic outcomes, the Committee decided to raise the target range for the federal funds rate to 0.25% to 0.50%”.

Wall Street also got the forward guidance it wanted to so hear on the pace of future hikes in 2016: “The Committee expects that economic conditions will evolve in a manner that will warrant only gradual increases,” the statement read. The key word, of course, was “gradual.”

In oil news today, we heard that congress reached a deal late Tuesday on a $1.1 trillion spending bill that would end the four-decade-long ban on most U.S. exports of crude oil. Facing plunging revenue and profits, U.S. oil and gas companies have announced 250,000 layoffs this year, according to a November report by consultant Graves & Co. that was cited by Bloomberg. The fact that U.S. producers may finally be allowed to sell unrefined crude oil to foreign customers is a welcome development to the industry but hardly a boon to the bottom line.

All of our 10 ETFs in the Spotlight headed higher as the rebound continued. Consumer Staples (XLP) led with +1.93%, while the Mid-Cap Value (IWS) lagged but still gained +1.21%.

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