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  • ETF Tracker Newsletter For June 14, 2019

    ETF Tracker StatSheet          

    You can view the latest version here.

    STUMBLING INTO THE WEEKEND

    [Chart courtesy of MarketWatch.com]

    1. Moving the markets

    All week long, the markets lacked some serious upward momentum with any rally attempts being rebuffed and cut short. As a result, the major indexes vacillated around their unchanged lines and failed to make much headway but managed to close slightly higher for the week.

    Disappointing Chinese economic data weighed on sentiment, as it appeared that signs of further cooling of business activity took their toll. The tech sector lagged, as Broadcom lowered its outlook for the rest of the year, which dashed hopes for a rebound in Semiconductors.

    Tensions in the mid-East increased with the blame game, as to who was responsible for the attack on 2 oil tankers, continuing. The U.S. blamed Iran, while Teheran denied any responsibility.

    On the domestic front, good news was bad news again, as the lame duck of the year, namely retails sales, rose +0.5% in May, just a little below expectations of +0.7%.

    However, April sales were revised to a +0.3% increase from a previously reported -0.2% decline. That did not sit well with the markets. Why? Traders were disappointed, as stronger economic data could potentially sway the Fed from lowering rates. Go figure…

    Another reason for the lackluster market environment is two important events scheduled for next week. First, the two-day Fed meeting with the release of their interest rate policy set for Wednesday. Second, the G-20 meeting during which Trump and Chinese Premier Xi may meet ‘to solve or not to solve’ the ever-escalating trade war.

    Depending on the various outcomes, markets could be rallying sharply or, if disappointed by, say, a too hawkish Fed, sell off and pull bond yields much lower. However, wherever yields may end up, it will far better than in Europe where the German 10-year yield hit a new negative record of -0.27%. Ouch!

    No one knows how things will play out, but it promises to be a highly volatile week.

    (more…)