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Posted by on Dec 28, 2015 in ETF Strategist, Market Insight

AdvisorShares Weekly Market Review – Week Ending 12/24/2015

AdvisorShares Weekly Market Review – Week Ending 12/24/2015

Highlights of the Prior Week

Santa Claus Checks In

Macro

Investors saw what could be described as a Santa Claus rally last week as equity markets moved higher. The Dow Jones Industrial Average was up 2.48%, the S&P 500 added 2.75%, the NASDAQ advanced 2.58% and the Russell 2000 was good for a 3.06% pop.

European equities were also higher. The DAX which was only open for three days was up 1.13%, the CAC 40 added 76 basis points and the FTSE 100 moved ahead 3.31% thanks in large part to a rally Wednesday in the mining sector. Asia was mostly higher as well except for the Nikkei 225, which trades on Christmas day, which fell 58 basis points while the Shanghai Composite, which is also open on Christmas day, gained 1.38%, the Hang Seng jumped 1.87% and the ASX 200 gained 1.9% with most of that gain coming Thursday in response to the strong Wednesday session in the UK.

You may have heard or read that the top performing global stock market for the year has been in Jamaica which has a total market cap of $5 billion after its 80% gain in 2015. Shares listed include Margaritaville Limited, Montego Ice and the exchange itself.

The yield on the Ten Year US Treasury Note inched up to 2.24% last week on economic data that was, what else, mixed. Jobless claims were positive with just 267,000. Third quarter GDP reported at 2.0% on an annualized basis while new home sales data came in weak and the previous month was revised down.

Yields in foreign markets were also higher on the week. The German bund moved up to 0.63%, the French OAT is back to 1%, the Swiss ten year yields -0.09%, Spain jumped 29 basis points to 1.98% and Italy closed out the week at 1.68%.

West Texas Intermediate Crude reversed the last two weeks of selling with a 6.2% gain. Energy stocks also rallied with the broad based sector ETFs gaining close to 4% versus 2.75% for the S&P 500. Gold also moved higher, gaining $10 or 0.9%.

ETF News & Data

Not surprisingly, Christmas week was quiet in terms of no new funds listed but of course late December is a busy time in terms of year end distributions. While many ETFs are able to avoid or have minimal if any capital gains, some futures based funds can have large distributions. Advisors may want to take the time to see what those payouts might be and possibly offsetting those gains elsewhere in the portfolio.

We would also again note large inflows in the funds tracking the S&P 500. Going by last year’s results we would expect to see more inflows in the final week of the year and then see those flows reverse in January. We will continue to track this to see if it plays out that way.

Interesting Reads

Star Wars: The Force Awakens has of course been in theaters for more than a week, breaking all sorts of box office records along the way. Like all Star Wars Movies there are plenty of questions, some things resolved and plenty left for the next movie in the series. For people who have seen the movie, slashfilm.com shares 26 Unanswered Questions of Star Wars: The Force Awakens: We Have The Answers. Well, some of the answers anyway. Fair warning; the article is for people who have seen the movie.

Sports

With the New Year coming just around the corner and many people intending to turn over a new leaf for improving their fitness we offer At 95, a Lifelong Skier Says the Source of His Vitality Is His Workout which profiles the remarkably vigorous workout routine of Klaus Obermayer in Aspen, CO. Just one aspect of his workout below;

He swims a bit more than a mile every day, either in the pool at his home, the solar-heated lap pool at the Sport Obermeyer offices or in the 25-meter heated saltwater pool at the Aspen Meadows Resort. “I find it easy to take a mindless state in the pool,” Mr. Obermeyer says. “When I swim, I’m forced to breathe deeply, and I like that I can stretch out my whole body.”

Source: Google Finance, Yahoo Finance, Wall Street Journal, SeekingAlpha, Bloomberg, Reuters, Barrons, ETF.com, XTF.com, Bespoke Investment Group, slashfilm.com
 
2015.12.28_Table1
 
Weekly ETF Flows

For December 21st, 2015 to December 24th, 2015

2015.12.28_Table2
 
S&P Sector Analysis

As for the sectors of the S&P 500, seven outperformed the broad benchmark – Energy, Materials, Industrials, Financials, Staples, Telecom, and Healthcare. The remaining three – Technology, Utilities, and Discretionary – each underperformed.  The dispersion between the top-performing and bottom-performing sectors was roughly 3.24% this week, with Energy outperforming all, and Discretionary coming in last.

For December 21st, 2015 to December 24th, 2015

As measured by the S&P 500 sector indices, respective performances were:

2015.12.28_Table3

The AlphaBaskets blog provides frequent market insight and commentary by AdvisorShares Investments, LLC, created by AdvisorShares and other leading active managers.  AdvisorShares Investments is an SEC-registered investment adviser and the investment adviser to the AdvisorShares actively managed ETFs. The views expressed on AlphaBaskets should not be taken as investment advice or a recommendation for any of the actively managed ETFs advised by AdvisorShares.

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