Stocks Unchanged—GOOG Vs MSFT Continues

Ulli Market Commentary Contact

Wed pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks teetered back and forth most of the day only to close relatively unchanged. The Dow was the only index that posted gains, which were nominal but a continued path of record numbers.

Eyes were on Janet Yellen today in her second day of Capital Hill testimony; however, her comments did not really generate any significant market-moving news. You may remember, yesterday, she suggested that the Fed is not in a hurry to raise interest rates.

Oil has been back on the rise for the past few weeks and continued the trend today. Benchmark U.S. crude rose $1.71 to close at $50.99 a barrel. Pushing prices higher today perhaps was Saudi Arabia’s oil minister, who said oil demand was growing and data showed Chinese factories were producing more than expected.

And in tech, the Google vs Microsoft boxing match continues. We heard today that Google, which has amassed more than $65 billion in cash and investments, bought critical equity of Softcard for an undisclosed sum and subsequently closed the Windows app. Google is encouraging former Softcard users to download its own Wallet app instead, which has failed so far to catch on with consumers.

2 our 10 ETFs in the Spotlight managed to advance during this choppy trading day, with 1 of them making a new high as table 2 below shows.

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Continuing The Ascent

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks closed at record highs once again Tuesday as investors reacted positively to remarks from Janet Yellen and Greece won EU approval for its proposed budget reforms.

Yellen, in her semi-annual speech before the Senate banking committee, used a word familiar to investors when she reiterated that the central bank will be “patient” on raising interest rates for the first time since 2008. Traders seemed to take that as a sign that interest rates would remain unchanged through the fall.

In stock news, retailer Home Depot (HD) rose (4%) to a record $116.75 close after posting an 18% gain in quarterly profits and hiking its stock dividend 26%. Among other Dow components, General Electric (GE) rose 1% to $25.39 and JPMorgan (JPM) rose 2.5% to $60.82. The gain in JPM stock came as a surprise today; given the fact that JPMorgan announced plans to shed $100 billion in large deposits by the end of the year and is going to close 300 branch locations.

And in the EU, Greece’s left-wing government delivered a list of reforms to Brussels on the cusp of Monday night’s deadline, after the country and its creditors reached a tentative agreement last week to extend a rescue loan program by four months to avoid the risk of a Greek default and exit from the euro currency. Greece’s loans were originally due to expire on Feb. 28. A Greek government official said the reforms would focus on curbing tax evasion, corruption, smuggling and excessive bureaucracy while also addressing poverty caused by a six-year recession.

8 our 10 ETFs in the Spotlight higher with 4 of them making new highs as you can see in table 2 below.

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Mixed Closing To Start Out The Week

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks closed mixed Monday as the Dow retreated from a record high but the Nasdaq managed to extend its winning streak to a ninth straight day. The S&P 500 was basically flat as oil prices fell back below $50 a barrel.

In economic news, sales of existing homes fell 4.9% in January from December. The number of sales stood at a seasonally adjusted annual rate of 4.82 million in January, the lowest since May’s figure of 4.9 million. Homebuilder stocks fell on the news.

Oil on the U.S. market fell $1.36 to close at $49.45 a barrel in New York. The yield on the 10-year Treasury note dropped to 2.06% from 2.11% Friday.

Greece and its European creditors agreed to a four-month extension on the country’s bailout Friday, but the 11th-hour deal only puts off a battle over controversial austerity measures that have weighed on the country’s economy.

5 our 10 ETFs in the Spotlight closed up with 2 of them making new highs as you can see in table 2 below.

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ETFs/Mutual Funds On The Cutline – Updated Through 02/20/2015

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 410 ETFs, of which currently 287 (last week 273) 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.

These ETFs are generated from my selected list of some 97 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. 50 ETFs (last week 45) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 459 (last week 423) above the line and 361 below it out of the 820 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 Fixed-Income Valuations Look Stretched?

Ulli Market Review Contact

92835431The US Federal Reserve is likely to remain patient and investors shouldn’t worry much as the US central bank will be very methodical and transparent about what they do, said Brain Jacobsen, chief portfolio strategist at Wells Fargo Advantage Funds.

The latest FOMC minutes showed the Fed’s tone was a little more dovish than the markets were anticipating. The equity markets didn’t react much to the Fed’s minutes because if investors put things in perspective and looked at the grand scheme of things, over the longer-term it didn’t really matter whether the central bank raised rates in June, September or at a subsequent interval.

The equity markets seem to be somewhat inoculated against what the Fed was doing. However, the scenario is different in the fixed-income markets, which are likely to show more volatility, he noted.

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New ETFs On The Block: ETFS Zacks Earnings Large-Cap US Index Fund (ZLRG)

Ulli Equity ETFs, Small Cap ETFs Contact

146026450ETF Securities, the London-based exchange-traded fund issuer known for its commodity-based products in the US, launched its first equity-based products in collaboration with US investment-research giant Zacks recently.

The two funds – the ETFS Zacks Earnings Large-Cap US Index Fund (ZLRG) and the ETFS Zacks Earnings Small-Cap US Index Fund (ZSML), focus solely on US large-capitalization and small-cap stocks only.

The new launches from ETFS come after a gap of nearly four years and are a clear departure from earlier products that took exposure only in physical and futures contracts of different commodities.

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