7 ETF Model Portfolios You Can Use – Updated through 2/26/2013

Ulli Model ETF Portfolios Contact

The major market indexes took it on the chin last week as a combination of punches thrown by the sequester discussions and unexpected results from the Italian elections were simply too much for the bulls to handle, and the bears had their day in the sun by knocking the S&P 500 down 2.22% since the previous ETF Model Portfolio report.

The markets recovered some yesterday on low volume indicating a possible dead cat bounce. Europe is back in the limelight as politicians watched in horror as Italian voters pounded the unelected technocrat Mario Monti in favor of unknown comedian/blogger Beppe Grillo.

While no clear majority was reached, and prolonged political instability/stalemate may be in the cards, the message was for the anti-establishment group and against EU sponsored austerity. The people have spoken, which is not what the EU central planners had in mind. I’m sure there will be more fallout to come as the so often announced “solved” Europe crisis has suddenly become “unsolved” again.

In the meantime, here’s the latest update for our Model ETF Portfolios:

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Equities Rebound On Economic Data, Fed Speak; Europe Slides On Italian Deadlock

Ulli Market Commentary Contact

Tue pic

[Chart courtesy of MarketWatch.com]

US stocks advanced Tuesday, recouping more than half of Monday’s biggest decline in the benchmark indices since November as Bernanke defended the Fed’s policy amid solid housing and consumer confidence data. The jury is still out whether that was just a low volume dead cat bounce, or the beginning of something more.

Economic activity in the US has continued to expand at a moderate and uneven pace, Bernanke said in his testimony while defending the Fed’s unprecedented asset purchase program. There is little risk of inflation or asset-price bubbles, the central banker told lawmakers in the first-day of his semi-annual monetary policy report to Congress and cautioned automatic spending cuts, set to begin Friday, will impose a significant burden on economy if politicians are unable to reach a deal to avert the cuts.

In economic news, data released by the Commerce Department showed new-home sales jumped 15.6 percent last month to an annual rate of 437,000, the highest mark since July 2008.

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US Indexes Break Below Major Milestone Levels As Italy And Sequestration Hit

Ulli Market Commentary Contact

Mon pic

[Chart courtesy of MarketWatch.com]

US stocks turned severely lower, with the Dow Industrials and the S&P 500 suffering their sharpest one-day decline of the year, giving benchmark indexes the biggest loss since November as political instability in Italy and looming spending cuts in the US hit investor sentiment.

Stocks erased early gains as partial election results suggested Italy may be left with a hung parliament as a strong performance by former Prime Minister Silvio Berlusconi may have given him a blocking minority to deny victory to the center-left coalition of Pier Luigi Bersani. Berlusconi’s coalition is seen as a threat to the nation’s austerity agenda while Bersani has campaigned to maintain the budget rigor of outgoing Prime Minister Mario Monti.

Stocks had pushed higher earlier on wagers Japanese Prime Minister Shinzo Abe will nominate a central bank chief who favors further monetary stimulus to haul the economy out of a 20-year long deflation.

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ETFs/Mutual Funds On The Cutline – Updated Through 2/22/2013

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 398 ETFs, of which currently 354 (last week 359) of them 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 93 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. 80 ETFs (last week 82) have managed to remain in bullish territory after the recent market volatility.

The third report covers Mutual Funds on the Cutline. There are currently 801 (last week 808) above the line and 58 below it out of the 859 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.

Last Week In Review: ETF News And Blog Posts To 2/24/2013

Ulli Market Review Contact

In case you missed it, here’s a summary of the ETF topics and market reviews I posted to my blog during the week ending on 2/24/2013.

Last week, I was talking about the tight trading range of the S&P 500 index and that eventually a breakout would occur. Last Wednesday, assisted by a potential threat that the Fed may water down the spiked punch bowl  the markets sold off some modest 2% over 2 days.

Friday’s recovery cut the losses in half, and the benchmark index actually closed lower for the week but by only by a scant 0.3%. Surely, a sell off was way overdue, but it remains to be seen if there is more downside activity preventing the run to new highs.

The trigger for more selling may not necessarily come from within the US, but is likely to originate in Europe where economic conditions are worsening by the week with Spain, Italy and France being hard hit. Adding insult to injury are the bribery scandals in Spain and questionable past banking deals in Italy just to name a few.

At this time, it looks like the previously considered core countries of Italy, Spain and France are anything but stable leaving only Germany as the ultimate paymaster. I don’t know when things will fall apart, but I doubt that we will see the EU making it through this year in its current status.

Over past week, we covered the following:

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One Man’s Opinion: Will Demand From Traditional Home-Owners Continue The Housing Recovery?

Ulli Market Commentary Contact

92835431The latest round of economic data sends out mixed signal about the US economy. The Philly Fed’s General Economic Index fell to minus 12.5 in February, the lowest since June, from minus 5.8 in January. Does this mean the nation’s economic concerns are more regional than national?

Not exactly, says Mark Zandi, chief economist at Moody’s Analytics Inc. The concerns are across the board although the Filly Fed Index has been unusually volatile, up and down and all around in recent months. Since last year this time, the index has been on the soft side, suggesting manufacturing, particularly in the middle line equation, has been a bit weak. But the concerns are there across the country, they are not just in the Philadelphia district or in California, but they are coast-to-coast, he observed.

The minutes from the Federal Reserve’s latest policy meeting seem to indicate the central bank is considering how to bring an end to assets purchases, the “quantitative easing.” The markets turned lower on that news on Thursday.

Asked what that selling pressure means for financial markets that were hoping to ride the wave of quantitative easing to all time highs this year, Mark said QE has been very important for the stock market and the bond markets and the expectation had been that the Fed would continue with the quantitative easing policy at least through the end of the year and probably into next.

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