To help investors keep up with the markets, we present our ETF Scorecard. The Scorecard takes a step back and looks at how various asset classes across the globe are performing. The weekly performance is from last Friday’s open to this week Thursday’s close.
The U.S. markets are starting to show some weakness again this week. Major foreign markets, including developed and emerging markets, are mixed for the week. During the FOMC statement this past Wednesday, interest rates remained the same (0.25% to 0.50%). This was no surprise given the dovish tones from previous Janet Yellen speeches. The estimated quarter-over-quarter real GDP released on Thursday was worse than expected at 0.5% annualized versus the consensus of 0.7%. Month-over-month core durable goods orders came in worse than expected on Tuesday at -0.2% versus the consensus of 0.5%. This is largely due to the slowdown in automotive industry sales. Consumer confidence also slipped on Tuesday as the figure came in at 94.2, less than the expected 96. On Thursday, the Bank of Japan held its interest rate press conference. During the conference, no additional stimulus was announced. This sent Japanese equities down and the Japanese yen higher. Governor Kuroda hinted that he will revisit the possibility of more stimulus after the effects of QE and negative interest rates become more apparent.
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Risk Appetite Review
The overall market as measured by the S&P 500 ETF (SPY A) was slightly down at a 0.55% decrease. What’s interesting is that the high-beta, low-volatility and equal-weighted S&P 500 ETFs were all up slightly for the week. The best performer out of these four ETFs is the low-volatility ETF (SPLV A), which is up 0.68% for the week.
Major Index Review
All major indexes are down for the week with the exception of the Russell 2000 (IWM B+), which is up 0.46%. IWM is also the best performer for the rolling month, having increased 5.65%. The PowerShares QQQ (QQQ A-) is down the most this week and rolling month, having decreased 2.68% and 1.19%, respectively. This is mostly due to the poor earnings reports this week from Alphabet (GOOG) and Apple (AAPL), which are both mega-cap equities in the top 10 holdings of QQQ.
Foreign Equity Review
Major foreign tracking ETFs are showing mixed results for the week, with the extremes being Brazil (EWZ B+) and Japan (EWJ A) ETFs. Brazil (EWZ B+) is up 5.25% for the week and 10.61% for the rolling month, representing the largest increase out of the foreign equity ETFs. Japan (EWJ A) is the worst performer for the week and rolling month. The ETF is down 5.57% for the week and is flat for the month at a slight 0.09% increase. As mentioned earlier, this is due to the lack of more stimulus action from the Bank of Japan.