Pages Menu
TwitterRssFacebook

Posted by on Feb 16, 2016 in ETF Strategist, Market Insight

AdvisorShares Weekly Market Review – Week Ending 2/12/2016

AdvisorShares Weekly Market Review – Week Ending 2/12/2016

Bookmark and Share

Highlights of the Prior Week

Abundant Volatility

Macro

Despite a big bounce on Friday domestic equities still closed lower for the fifth week out of the last seven. As has been the case all year, trading was very volatile. For the week the Dow Jones Industrial Average fell 1.43%, the S&P 500 dropped 83 basis points, the NASDAQ was off 0.61% and the Russell 2000 slid 1.40%.

Europe fared much worse with more volatility than the US. The DAX fell 3.43%, the CAC 40 was down 5.09% and the FTSE 100 had a 2.4% setback. Like their US counterpart, European economies are struggling to with GDP growth and inflation rates that are too low but they have the added problem of an unemployment that is approximately twice that of the US. This is of course why the ECB has resorted to NIRP (negative interest rate policy).

Asia was worse still, at least the markets that were trading. The Nikkei 225 plummeted 10.27%, the Hang Seng Index was only open Thursday and Friday which was enough for it to fall 4.98% and the ASX 200 dropped 4.24%. The Shanghai Composite was closed all week for the New Year.

Markets opened the new week higher across the board including a 7% lift in Japan during the Monday session.

The yield on the Ten Year US Treasury Note traded in a very wide range closing out ten basis points lower at 1.74% but going as low as 1.53% on Thursday. The yield on the German bund traded down to 0.26%, the French OAT inched up to 0.65%, the Swiss ten year moved up to -0.24%, Spain now yields 1.73% and Italy is at 1.65%.

West Texas Intermediate Crude fell 6.52% on the week to $29.08 despite an 11% rally on Friday. Such large moves are signs of instability as the market tries to figure out what a “lower for longer” scenario might mean for for the economy and companies in the space.

Gold was up 6.13% sparking a lot of “is now the time to buy gold” chatter in the media after many decried the death of gold just a couple of months ago. We have maintained that gold has continually done what investors should hope it would do which is to look nothing like the stock market. For years as the stock market rallied gold declined or otherwise languished. Lately, stocks have rolled over and gold has lifted well past $1200.    

ETF News & Data

The volatile and declining markets did not prevent asset from moving into equity funds tracking the S&P 500 to the tune of $6 billion and to a lesser extent, gold which has done well in the face of most equity markets doing poorly. Outflows came from narrower,more volatile funds like biotech as well as country funds tracking Japan and Germany.

There were four new funds listed last week including an ETN tracking crude oil and another tracking MLPs.

Interesting Reads

Gear Patrol took a fun look at the 15 Best Independent Record Stores In America.

Good news for vinyl collectors. Great news for record shop owners. For years, the record store was an endangered beast. (In NYC, in 2012, the famous Colony Music store near Times Square closed after 64 years in business. Handfuls of others have been shut down or moved away in search of lower rents, at least one being replaced by a low-fat frozen yogurt shop.) Now, these hubs — inundated with the smell of incense, mothballs and cardboard, teeming in the ’70s with kids hiding from their moms and smoking pot, now teeming with those same kids, grown up, now hiding from their own kids, and still smoking pot — have a bright future to look forward to.

Sports

You may already know that Marshawn Lynch will be retiring from the NFL but you may not know that like more and more younger players he has saved almost all of his salary to the tune of a reported $49 million. A site called Urban Intellectuals reports;

The Seattle Seahawks Marshawn Lynch has reportedly saved nearly all of his NFL playing money. His saved amount adds up to 49 million dollars. Lynch has taken this unusual decision to save nearly all of his playing money. When he decides to ride off into the sunset he will not have any sleepless nights due to his amassed fortune.

It appears Marshawn Lynch has decided to retire from football and it makes sense now that he has worked hard to save his money because he was planning to walk away from the game early.

The Urban Intellectuals site is so aggressive with popups that we’re going to refrain from sharing their link.

Source: Google Finance, Yahoo Finance, Wall Street Journal, SeekingAlpha, Bloomberg, Reuters, Barrons, ETF.com, XTF.com, Bespoke Investment Group, Gear Patrol, Urban Intellectuals
 
2016.02.16_Table1
 
Weekly ETF Flows

For February 8th, 2016 to February 12th, 2016

2016.02.16_Table2
 
S&P Sector Analysis

As for the sectors of the S&P 500, five outperformed the broad benchmark – Staples, Healthcare, Energy, Technology, and Discretionary. The remaining five – Industrials, Telecom, Materials, Utilities, and Financials – each underperformed.  The dispersion between the top-performing and bottom-performing sectors was roughly 3.15% this week, with Staples outperforming all, and Financials coming in last.

For February 8th, 2016 to February 12th, 2016

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

2016.02.16_Table3

Bookmark and Share