Stocks End Mixed Amidst Mixed Economic Data

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks dipped lower late in the trading day, as investors tried to balance falling consumer confidence against a better-than-expected report on economic growth. The S&P 500 dropped 0.12%, the Dow shed 0.02%, however the Nasdaq gained 0.07%. Crude oil prices also dropped 2.5% today to close at $74.30 a barrel.

Consumer confidence unexpectedly fell in November as the Conference Board’s closely watched index dropped to 88.7 from 94.1 in October. Overall, the economy has notched the best six months of growth since 2003, including a 4.6% annualized rate of expansion in the second quarter, following a first-quarter contraction caused largely by severe winter weather. Monthly job growth has picked up this year, and factory output and business investment have advanced, while consumer spending and the housing market have been mixed.

The major event this week is a meeting in Vienna on Thursday of members of the Organization of Petroleum Exporting Countries. As the price of oil continues to slump, traders will be looking for a possible agreement to cut production to increase demand, i.e. prices. The price of crude has tumbled 26% since June.

3 of our 10 ETFs in the Spotlight edged up during this see-saw day with all 3 of them making new highs while 2 of them remained unchanged, as the YTD table below shows.

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Another Day, Another Record High For The Dow And S&P 500

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks continued their climb upwards heading towards the Holiday season today. The S&P 500 gained 0.27%, the Dow was up 0.04% and the Nasdaq added 0.89%. The Dow and S&P both set new record highs today, which was the 29th time this year for the Dow and the 46th time for the S&P. Wall Street is hoping that the markets extend their 5-week winning streak in this shortened Holiday week.

We have been talking about Apple (AAPL) off and on over the past week, as investors have been speculating as to whether or not they will become the first ever $700 billion company. Well, shares of apple gained 1.85% today to close at 118.63, which pushed the market cap higher to $695.72 billion. How high can they go?

Interestingly enough, the timber market stole a couple of headlines today, but it seems that now timber is an investment more suitable for the wealthiest 1%. After seeing their portfolios pummeled during the recession, many wealthy people (according to Bloomberg) have flocked to asset classes that don’t rise and fall with the stock markets. Timber is a long-term play, and most investors see it as a tool to transfer wealth from one generation to another…or to simply cover everyday expenses by granting hunting licenses and selling off pine straw, which is commonly used in landscaping.

8 of our 10 ETFs in the Spotlight inched up today with 7 of them making new highs as the YTD table below shows.

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ETFs/Mutual Funds On The Cutline – Updated Through 11/21/2014

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 291 (last week 279) 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 43) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 719 (last week 706) above the line and 127 below it out of the 846 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 China, Japan And Europe Need To Undertake Structural Reforms To Realize True Potential?

Ulli Market Review Contact

92835431The People’s Bank of China (the Chinese central bank) cut interest and deposit rates to boost growth Friday. China has a political problem and Chinese leaders need economic growth to provide legitimacy for the communist party, said Jamie Metzl, Senior Fellow at the Atlantic Council.

Beijing is trying to steer a little bit toward slower growth to rebalance and reform the economy. But every-time the economy faces headwind, Chinese leaders tend to panic a bit, as exemplified now. The rate cut is a plus in the short term but a worrying sign for the much needed reforms in the long term, he noted.

The PBOC said the rate cut is not a change in monetary policy, and the move is “within appropriate range.” Asked if the central bank’s language is nuanced or if it is missing the point, Jamie said the language is nuanced because the PBOC is injecting stimulus in the economy to avoid a slowdown and then saying it’s not getting off the reform-path.

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New ETFs On The Block: iShares MSCI Emerging Markets Horizon ETF (EMHZ)

Ulli Emerging Markets ETFs Contact

122227577iShares, the world’s biggest the exchange-traded fund issuer, recently launched a new emerging market fund that focuses on the “beyond BRICS” theme and looks to tap the rapid growth in other emerging markets in Asia, Eastern Europe, Latin America and the Middle East.

The iShares MSCI Emerging Markets Horizon ETF (EMHZ) provides exposure to companies that could well be the next generation of emerging market growth stars.

The passively-managed EMHZ tracks the MSCI Emerging Markets Horizon Index, a gauge that considers the smallest quartile of countries from the broader MSCI Emerging Markets Index. That makes the new fund a subset of the highly successful $36 billion iShares MSCI Emerging Markets ETF (EEM).

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11-21-2014

Ulli Newsletter Archives Contact

ETF/No Load Fund Tracker Newsletter For November 21, 2014

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2014/11/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-11202014/

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Market Commentary

Friday, November 21, 2014

STOCKS FINISH SOLID AND MARK FIFTH STRAIGHT WEEK OF GAINS

Fri pic

[Chart courtesy of MarketWatch.com]

1. Moving the Markets

Stocks moved higher on the week, which marks the fifth consecutive weekly advance. Markets were boosted by improving economic indicators, solid corporate profits and aggressive monetary policy stimulus from Europe to Asia.

All major indexes finished higher today. The S&P 500 gained 0.52%, the Dow 0.51% and the Nasdaq 0.24%. Once again, the S&P 500 and Dow closed at record highs.

Global markets advanced as well, as central bankers from China and Europe reiterated their support for markets and struggling economies abroad. The global rally was sparked after China announced a surprise interest rate cut and the European Central Bank chief Mario Draghi said the ECB is ready to take additional steps to stimulate the weak Eurozone economy.

The holiday-shortened week ahead is packed with economic data on Tuesday and Wednesday. Housing activity will be in focus with the release of new home sales, pending home sales, and several price indexes. Also getting attention will be Q3 GDP, which is seen being downwardly revised to a 3.3% annualized increase.

We will also hear additional insight into the strength of the consumer via the release of personal income and spending in October. Markets will be closed on Thursday for the Thanksgiving Holiday, and will have a shortened session on Friday.

All of our 10 ETFs in the Spotlight managed to close up today with 5 of them making new highs as the YTD table below shows.

2. ETFs in the Spotlight

In case you missed the announcement and description of this section, you can read it here again.

It features 10 broadly diversified ETFs from my HighVolume list as posted every Monday. Furthermore, they are screened for the lowest MaxDD% number meaning they have been showing better resistance to temporary sell offs than all others over the past year.

Here are the 10 candidates:

MaxDD

The above table simply demonstrates the magnitude with which some of the ETFs are fluctuating in regards to their positions above or below their respective individual trend lines (%M/A). A break below, represented by a negative number, shows weakness, while a break above, represented by a positive percentage, shows strength.

Year to date, here’s how the above candidates have fared so far:

YTD

Again, the first table above shows the position of the various ETFs in relation to their respective long term trend lines (%M/A), while the second one tracks their trailing sell stops in the “Off High” column. The “Action” column will signal a “Sell” once the -7.5% point has been taken out in the “Off High” column.

3. Trend Tracking Indexes (TTIs)

Our Trend Tracking Indexes (TTIs) picked up steam this week with the international one slowly but surely advancing on the plus side of its trend line. Today’s rally confirmed the trend change from bearish to bullish so, effective 11/24/14 the International TTI is back in ‘Buy’ mode. This affects all “broadly diversified international mutual funds and ETFs.”

Here’s how we ended the week:

Domestic TTI: +3.47% (last Friday +3.13%)—Buy signal since 10/22/2014

International TTI: +1.24% (last Friday +0.20%)—New Buy signal effective 11/24/14

Have a nice weekend.

Ulli…

Disclosure: I am obliged to inform you that I, as well as advisory clients of mine, own some of these listed ETFs. Furthermore, they do not represent a specific investment recommendation for you, they merely show which ETFs from the universe I track are falling within the guidelines specified.

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READER Q & A FOR THE WEEK

All Reader Q & A’s are listed at our web site!
Check it out at:

http://www.successful-investment.com/q&a.php

Reader Ed:

Q: Ulli: I have available funds to add to my investments but feel this is not the time. I’m 84 and do not feel comfortable investing with most funds at their record highs. Any thoughts would be appreciated.

A: Ed: The most important thing when investing is your personal comfort level. Nothing else matters more than that; neither the investment method, nor any news, opinions or even my suggested exit strategies for that matter. If you have any discomfort, simply don’t invest until such time that your risk tolerance allows you to do so.

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WOULD YOU LIKE TO HAVE YOUR INVESTMENTS PROFESSIONALLY MANAGED?

Do you have the time to follow our investment plans yourself? If you are a busy professional who would like to have his portfolio managed using our methodology, please contact me directly or get more details at:

https://theetfbully.com/personal-investment-management/

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Back issues of the ETF/No Load Fund Tracker are available on the web at:

https://theetfbully.com/newsletter-archives/