US Equity ETFs Suffer Delayed Fall On Weak Jobs Data; VXX Rises For The Fifth Day While GAZ Slips

Ulli Market Review Contact

[Chart courtesy of MarketWatch.com]

Following the government’s nonfarm payrolls report on Friday that showed companies added fewer jobs than forecast, US stocks suffered their biggest loss in over a month on Monday, reacting on the first trading day since the report was published last week.

Analysts however, attributed Monday’s pull-back to profit booking by investors, pointing out average monthly job-addition still tops the 200,000 mark.

As demand for US safe-haven assets shot up amid fears of a global slowdown, US 10-year Treasuries made their biggest gain in four weeks Monday. Yields on Treasuries dropped following speculations of further rounds of quantitative easing by the Federal Reserve in view of the lousy job market data.

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ETFs/Mutual Funds On The Cutline – Updated Through 4/5/2012

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 326 (last week 346) 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. 64 ETFs (last week 72) have managed to move into in bullish territory after the recent run up.

The third report covers Mutual Funds on the Cutline. There are currently 794 (last week 802) above the line and 67 below it out of the 861 that I follow.

Take a look:

1. ETF Master Cutline Report

2. ETF High Volume Cutline Report

3. MF Cutline Report

Last Week In Review: ETF News And Blog Posts To 4/8/2012

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 4/8/2012.

Again, last Monday provided the fireworks, after which we went downhill during the next four trading days.

Contributing to the decline of the major market ETFs during this Holiday shortened week were the notes of the FOMC meeting essentially downplaying the need for any more stimulus efforts by the Fed.

That pulled the rug out from any upward momentum; no surprise there as we have been living with rallies supported by QE efforts during 2010 and 2011. No one has any idea where the market indexes would level out at without support from the Fed.

Friday’s unemployment report came in way under expectations, and the futures market quickly dropped over 1%. We will see how this disappointment will affect the indexes on Monday when trading resumes.

Actually, in Wall Street’s perverse way of thinking, this could be good news for stocks as it brings the possibility of further Fed easing back into play again. Go figure…

This week, we covered the following:

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US, Japan Stocks Look Good From Valuation And Growth Perspective

Ulli Market Commentary Contact

Much have debated over the US job data for March and whether the growth momentum can be sustained. Analysts have predicted a pull back of up to 10 percent before markets rebound.

John Vail, chief global strategist and head of asset allocation of Nikko Asset Management in Tokyo thinks US job growth is robust and one weak month doesn’t indicate a trend reversal.  Also, there has been a big seasonal adjustment in the job market, affecting March data. The weather, especially the unusually warm recent months, played a big role in slowing down the job growth.

The important development is that the US stock market boomed in the first quarter of 2012, precisely the same time when people were talking of the Eurozone breaking up. The situation in Europe has flared up again, as Spain failed to meet its budget deficit targets.

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Looking For ETF Investment Opportunities As The Markets Experience A Pull-Back?

Ulli Market Review Contact

The stock markets have done remarkably well thus far this year with the S&P 500 index posting its best quarter since 1998, soaring more than 12 percent in the past three month, which can certainly be called an aberration supported by excess liquidity and artificially low interest rates.

The markets, however, witnessed a pull back this week, triggered by the FOMC minutes first. Later the ghosts of Europe returned to haunt investors as yields on Spanish debts jumped. The country struggled to sell medium-term notes on Wednesday and managed to raise €2.6 billion from the auction; closer to the bottom of its €2.5-€3.5 billion target.

The Spanish debt-problem has been attracting some attention and there has been an increased chatter over the Greek saga getting repeated again. The country needs to refinance debts worth €370 billion over the next three years, and sharp spending cuts announced by Prime Minister Mariano Rajoy has fuelled speculations of the country witnessing widespread social unrest.

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04-06-2012

Ulli Newsletter Archives Contact

ETF/No Load Fund Tracker Newsletter For Friday, April 6, 2012

ETF/No Load Fund Tracker StatSheet

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

https://theetfbully.com/2012/04/weekly-statsheet-for-the-etfno-load-fund-tracker-newsletter-updated-through-04052012/

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Market Commentary

Friday, April 6, 2012

MARCH PAYROLLS REPORT TRAILS FORECAST; BERNANKE’S JOBS WARNING COMES TRUE

The US economy’s expansion came under threat as hiring by American employers trailed most pessimistic forecasts in March. Employers added 120,000 jobs in March, the fewest in five months, proving the Federal Reserve chairman right who had warned of slower payroll growth last month.

Manufacturing, one of the key drivers of recovery, cooled in March with the ISM reading tumbling to 53.4 from a high of 59.9 in the beginning of 2011. The unemployment rate dropped to 8.2 percent from 8.3 percent in the prior month.

Private payrolls climbed a meager 121,000 in March following the addition of 233,000 jobs in Feb. Manufacturing jobs however, grew by 37,000 after a 31,000 growth, despite the ISM reading tumbling for the month.

Average work week declined to 34.5 hours from 34.6 while average weekly earnings dropped to $806.96 from $807.56.

With today’s report, the Fed is not likely to change the benchmark interest rate, currently hovering around zero percent. However, it’s also unlikely to trigger new asset purchases via quantitative easing when the policy makers meet next on April 24-25.

On the other hand, if the weak trend continues through April and May, a case for added monetary stimulus may/will be made not only during the June FOMC meeting, but would also be loudly supported by Wall Street’s players, who can’t wait to get the punch bowl back.

Our Trend Tracking Indexes (TTIs) headed south from last Friday’s position, but both remain deep in bullish territory. Here are this week’s closing numbers:

Domestic TTI: +4.63% (last week +5.10%)

International TTI: +3.76% (last week +5.39%)

Have a great week.

Ulli…

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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

A note from reader Jack:

Q: Ulli: Could you please explain the difference between a ‘buy’ and a ‘selective buy?’ You use these terms in your weekly StatSheet, but I can’t seem to find an explanation.

A: Jack: A ‘buy’ refers to all broadly diversified domestic and international funds/ETFs that are tied into the Domestic and International TTI (Trend Tracking Index) as a guide for making buy/sell decisions.

In the case of Country/Sector ETFs, a TTI does not exist, so ‘buy’ decisions will need to be made once each individual ETF crosses its respective trend line to the upside. Some may do that sooner, thereby generating a buy signal quicker, while others may lag; hence the term ‘selective buy.’

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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/