One Man’s Opinion: Will Higher Home Prices Drive US Inflation?

Ulli Market Review Contact

ManMarket observers would not expect the Federal Reserve to raise rates in October or December this year because historically the US central bank has been sensitive to international concerns, said Bill Smead, CEO and CIO of Smead Capital Management.

Many times in the past the Fed has been sensitive to what has been going in Asia or Latin America, and thanks to the recent developments in Brazil and China, caution prevails.

While Fed Chair did mention China in the FOMC meeting, she didn’t mention China even once during her speech Thursday. Asked to comment, Bill said the Fed probably inferred if they’d raise interest rates in the middle of market turbulence the dollar may become extremely strong and set the ground for some more commotion, which would trigger another race to the bottom in the world of currency participants.

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New ETFs On The Block: Compass EMP International 500 Volatility Weighted Index ETF (CIL)

Ulli International ETFs Contact

91551519Compass Efficient Model Portfolios (Compass EMP), which was recently acquired by Victory Capital, launched two volatility-weighted funds that widened the firm’s lineup of so called smart-beta products and brought its total number of offering to ten.

The Compass EMP International 500 Volatility Weighted Index ETF (CIL) and the Compass EMP International High Dividend 100 Volatility Weighted Index ETF (CID) seeks to provide investors more stable exposure to global stocks through smart-beta investing.

The new funds CIL and CID track the Compass EMP International 500 Volatility Weighted Index and the Compass EMP International High Dividend 100 Volatility Weighted Index, respectively, and are designed to outperform traditional indexes by combining fundamentals with broad market volatility weighting screens of individual securities.

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ETF/No Load Fund Tracker Newsletter For September 25, 2015

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ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2015/09/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-09242015/

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Market Commentary

UNCERTAINTY REMAINS

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks ended the week on a mixed note despite a big early rally Friday after Federal Reserve Chair Janet Yellen’s comments about a potential rate hike.

Yellen gave stocks a broad boost early today after she suggested in a speech yesterday that global economic weakness won’t be significant enough to alter the central bank’s plan to raise its key short-term rate by December.

Uncertainty over the Fed’s timetable for raising rates has been weighing on the market as investors seek clarity on monetary policy was offset later in the day by plunging biotech stocks, which dragged the Nasdaq into negative territory for the day and further into the red for 2015.

Looking forward, Friday’s jobs report will be the marquee economic event. Perceived strength in the report could give the FOMC what it needs to raise short-term interest rates by the end of 2015. Other important economic numbers to watch include construction spending on Thursday and factory orders on Friday.

For the day, 4 of our 10 ETFs in the Spotlight ended up on the plus side as Consumer Staples (XLP) took the lead by gaining +0.66%. Losing big time was Healthcare (XLV), which got slaughtered and lost -2.75%.

Bearish momentum remains alive and well.

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Weekly StatSheet For The ETF/No Load Fund Tracker Newsletter – Updated Through 09/24/2015

Ulli ETF StatSheet Contact

ETF/Mutual Fund Data updated through Thursday, September 24, 2015

TOC 090315

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 8/24/2015

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 below its long term trend line (red) by -2.36% after having generated a “Sell” signal as of 8/24/2015, which applies to all “broadly diversified domestic equity ETFs/Mutual Funds.”

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Markets Dive—But Are Still Swimming

Ulli Market Commentary Contact

Thur pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Equities climbed out of a deep dive Thursday, but the Nasdaq slid into negative territory for the calendar year as stocks posted their third straight loss.

The Dow took a hit from Caterpillar (CAT) after the company announced it would be cutting up to 5,000 jobs by the end of 2016 and could potentially shed up to 10,000 workers by the end of 2018. The stock dropped plunged more than 7% on the day.

Investors continue to grapple with a host of negatives, including the stock market’s inability to muster any signs of a lasting bounce, Volkswagen’s (VW) emissions crisis, and persistent worries over interest rates and China’s economic slowdown.

The good news on the economic front today was that the latest reading on weekly first-time initial jobless claims came in at 267,000, below the 272,000 analysts estimated but up slightly from 264,000 in the prior week. Durable goods orders for August fell 2%, but that was a little better than expectations.

Our 10 ETFs in the Spotlight were mixed again as an early sell-off turned into a rebound. Only 2 of them gained, led by the Dividend ETF (DVY) with +0.33% and 8 of them closed below the unchanged line with Healthcare (XLV) being the loser at -1.05%.

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Stocks Continue Dropping; China Buying Big From Boeing

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

U.S. stocks posted a second straight day of declines but trimmed earlier losses to end only slightly in the red. Stocks have been on a consistent decline since late August, since fears around China’s slowing economy and global growth in general took hold. As you know, according to my Domestic Trend Tracking Index (TTI), we have been in bear market territory effective 8/24/15.

One thing that could turn market sentiment is a fundamental factor in equity valuation, corporate profits. Corporate earnings season for Q3 will begin in early October and Wall Street hopes upcoming earnings reports can break the volatility that markets have been experiencing.

Shares of German automaker Volkswagen (VLKAY), which admitted it used software to cheat on emissions tests, rose about 3% Wednesday, snapping a two-day losing streak. Many investors are showing mixed emotions on where the stock could go, especially given that the CEO Martin Winterkorn announced today that he will be resigning. Volkswagen’s board is expected to appoint a successor on Friday.

And in airline news, Xi JinPing has approved a deal for China to buy 300 Boeing aircraft for $38 billion and build the first aircraft completion plant in that country. The massive Boeing order includes 190 of the 737 model aircraft and 50 wide-body planes for Chinese airlines, and 60 single-aisle planes for leasing companies. China Aviation Supplies Holding Company, ICBC Financial Leasing Co., Ltd., and China Development Bank Leasing with Boeing, will be purchasing the planes.

Our 10 ETFs in the Spotlight presented a mixed picture with 3 of them gaining and 7 of them losing. Leading on the upside were the Financials (IYF) with +0.31%, while on the downside the equal weight ETF (RSP) surrendered -0.42%.

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