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Posted by on Feb 18, 2014 in Market Insight

AdvisorShares Weekly Market Review – Week Ending 2/14/2014

AdvisorShares Weekly Market Review – Week Ending 2/14/2014

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Highlights of the Prior Week

Macro

Both houses of Congress voted to suspend the debt ceiling until March 15, 2015. The country has of course been held hostage twice recently by Congress as they bickered over debt ceiling. This of course has contributed to perceptions of dysfunction in Washington DC and while there is hardly harmony on the hill, both parties did come together on this issue.

Unfortunately, this news probably takes us further away from any sense of fiscal responsibility after now many years of profligate borrowing and spending in hopes of stimulating economic activity.

For the week the S&P 500 was up 2.3% according to Google Finance and for the month it is up 3.1%. For all of the anguish caused in January, the S&P is now down about 50 basis points for the year.

Gold as measured by GLD was up 4% perhaps due in part to the suspended US debt ceiling.

Foreign Markets

Foreign markets continued to not be the story this week with both iShares MSCI EAFE ETF (NYSEARCA:EAFE) and iShares MSCI Emerging Markets ETF (NYSEARCA:EEM) both going up in lockstep with US markets.

It’s also worth noting that some of the worst performing markets YTD showed some signs of life; the Global X Colombia 20 ETF (NYSEARCA: GXG) was up 3.5% this past week.

ETF News & Data

Despite the positive week for equities, bond ETFs continued to see the largest inflows with XTF reporting that the top five were all bonds funds; three funds from iShares, one from Vanguard and a levered bond ETF from ProShares.

Outflows continue to be paced by broad based equity funds like SPY, IVV which is the iShares S&P 500 ETF and EEM. In addition to AdvisorShares new gold ETFs, iShares got its feet wet in the currency hedged equity ETF space with funds targeting EAFE and Germany.

Interesting Reads

The benefits of working past the normal retirement age are generally accepted to include being more physically fit and more intellectually engaged. A great example of this comes from Lyle Ruterbories who at 93, is the oldest ranger for the National Park Service. He works at Glacier National Park in Montana and you can read about him in the Billings Gazette.

Sports

Sports and business intersected last week when questions were raised about whether or not the US Long Track Speed Skating Team’s poor performance could be tied to their suits which were made by Under Armor (NYSE:UA).

The Wall Street Journal covered the story, noting that vents in the back of the suits designed to let heat escape also let air in which creates a drag.

Just how much could this matter? That is difficult to accurately quantify. US medal hopes for the men’s 1000 meters rested on Shani Davis who finished in eighth place which was 0.29 seconds behind the gold medal time. Under Armor stock was down modestly on Friday in an otherwise up day for US equities. Ultimately, the team dumped the suits for an older version.

 Roger Nusbaum
AdvisorShares ETF Strategist
 
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Weekly ETF Flows

For February 7, 2013 to February 14, 2014

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S&P Sector Analysis

As for the sectors of the S&P 500, five outperformed the broad benchmark – Utilities, Healthcare, Materials, Telecom, and Energy. The remaining four – Staples, Industrials, Technology, Discretionary, and Financials – each underperformed.  The dispersion between the top-performing and bottom-performing sectors fell to 2.02% this week, with Utilities outperforming all, and Financials  coming in last.

For February 7, 2013 to February 14, 2014

Sector performances, as measured by the S&P 500 sector indices were:

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