ETF/No Load Fund Tracker Newsletter For June 19, 2015

Ulli ETF Tracker Contact

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2015/06/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-06182015/

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Market Commentary

QUADRUPLE-WITCHING-DAY PULLS INDEXES DOWN AFTER A SOLID WEEK

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

The major indexes managed to end the day in the red yet gained nicely for the week. Contributing to today’s cautious stance was the continuing Greek saga as the debt talks ended in the usual deadlock. Adding to the volatility was the always disruptive quadruple-witching-day with options and futures for stocks and indexes expiring simultaneously.

As you can see from the above chart, we had a nice rebound in the S&P early in the week, which was really surprising as the main driving force, the Federal Reserve, did not make any earthshaking statements, so it pays, as always, not to pay attention to any public jawboning but to stay with the major trend.

Of course, all eyes are on Greece and another scheduled emergency crisis summit on Monday after numerous meetings failed to produce an agreement with its creditors. Of course, many analysts are baffled about the domestic equities’ strong performance in the face of the Greek crisis, but I think markets usually react more negatively to sudden unknown events rather than expected ones with simply an unknown timeline. I am sure we’ll find out next week whether this theory holds up this time.

All of our 10 ETFs in the Spotlight retreated after sporting nice gains earlier in the week. Leading the downside was the S&P 500 (SPY) with -1.04%, while Mid-Cap Value (IWS) dropped only by 0.37%.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 06/18/2015

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, June 18, 2015

TOC021915

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

 

1. DOMESTIC EQUITY MUTUAL FUNDS/ETFs: BUY — since 10/22/2014

TTI

Our main directional indicator, the Domestic Trend Tracking Index (TTI), broke through its long-term trend line generating a “Sell” for this arena effective 10/14/2014, which was followed by a violent break back above the line on 10/22/14 generating a new “Buy.” It was a classic whipsaw signal, and you can read more on my blog as to the events as they were unfolding.

As of today, our TTI (green line in above chart) is positioned above its long term trend line (red) by +2.24% keeping us in the market with our established positions.

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Shifting Into Overdrive

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Domestic stocks shifted into overdrive today rallying sharply and sending the Nasdaq and Russell 2000 to record highs, while all other major indexes scored nicely.

Supporting today’s euphoria was the fact that the Fed did not only not produce any earthshaking news yesterday but also set a dovish tone in its announcement of a slower pace in regards to potential rate hikes. That’s all the bulls needed to digest, after a good night’s sleep, and we were able to add to yesterday’s meager advance.

Despite the global background not being very favorable towards growth and equities, there was no bearish news, so the indexes took the path of least resistance, which was up. Whether this rip-roaring day turns into a blow-off topping formation remains to be seen; for right now, Wall Street was all smiles.

With the indexes racing full steam ahead, it’s no surprise that all of our 10 ETFs in the Spotlight joined the rally and closed sharply higher. The leader today was Healthcare (XLV), which added 1.41%, while the laggard was the Russell MC Value (IWS) with “only” a 0.81% gain.

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Fed Signals Gradual Tightening—Indexes Inch Higher

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

It was a choppy session as the indexes rallied at first, pulled back mid-day, rallied again and sold off into the close but managed to stay above the unchanged line.

As expected, the Fed left interest rates unchanged while the commentary pretty much remained the same as in “we’ll watch economic data” and “the timing of rate hikes is not as important as the pace and trajectory,” and so on. In other words, the Fed managed again to avoid any commitment other then that the policy will be still accommodative.

In the end, the market reaction was relatively muted due to unchanged policy theme and, as has been the mode of operation in the past, the food presented was pretty much the same as last time.

9 of our 10 ETFs in the Spotlight inched higher again led by Consumer Staples (XLP) with a 0.54% gain. Only the Financials (IYF) ended up slightly on the minus side by losing 0.09%.

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Finding Upward Momentum

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Finally, the major indexes found some some lost upward momentum and closed higher in the face of unsuccessful Greek talks and the widely anticipated outcome of a two-day Fed meeting the results of which will be published tomorrow.

However, trading was cautious as volume remained very low. While the outcome of the Fed meeting is not expected to present any major surprises, market reaction therefore may be muted but volatility will definitely ramp up on Friday as options expiration day is lurking.

While the roller-coaster, AKA the Greek debt negotiations, can affect market direction, the main driver, however, is the Fed and its policies, which is why every word of the announcement will be dissected for any hidden hints.

All of our 10 ETFs in the Spotlight recovered and sprinted higher. Consumer Staples (XLP) was the leader gaining 1.09% while the Global 100 (IOO) trailed but added 0.13%.

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Markets Sour To Kick Off Second Week Of June

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Global markets started the week on a softer note after talks on the Greece bailout broke down on Sunday. The Dow Jones industrial average dropped 108 points to end back in the red for 2015 as both domestic and global concerns weighed on investors. Chief concerns include the ongoing stalemate between Greece and its creditors, and this week’s Federal Reserve meeting on interest rate policy.

The Fed kicks off a two-day meeting on rates tomorrow and will issue a policy statement Wednesday. Fed Chair Janet Yellen will also face off with the press after Wednesday’s meeting adjourns, and will discuss the Fed’s current economic outlook and hopefully provide investors with a road map as to when the Fed plans to raise rates and why.

In M&A news, we heard today that Target (TGT) intends to sell its pharmacy business to CVS (CVS) for $1.9 billion. Many analysts are claiming ‘bargaining power’ as one of the primary drivers behind the deal. With Target’s pharmacy distribution channels, CVS should have greater bargaining power with drug makers for lower prices, which could turn pharmacy margins upside down in Target stores. Pharmacies will remain in Target stores, but carry the CVS brand name.

9 of our 10 ETFs in the Spotlight headed south led by the Low Volatility ETF (SPLV) with a loss of 0.83%. Bucking the trend was Healthcare (XLV), which eked out a gain of 0.12%.

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