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’s Thursday close.
- The European Central Bank left its monetary policy unchanged, with the bank’s President Mario Draghi saying the Eurozone economy still needs significant monetary accommodation. However, Draghi said the stimulus withdrawal will not be delayed, contending a slowdown in the European economy is transitory. The ECB acknowledged that the economic data was weaker than expected, but welcomed the rise in negotiated wages, a sign that inflation will pick up.
- The U.S. home market is in decline as rising interest rates hamper demand. Existing home sales dropped for the seventh month in a row in September, reaching a two-year low of 5.15 million. Analysts had expected a showing of 5.29 million.
- U.S. new home sales woefully disappointed in September, coming in at 553,000 versus 625,000 expected by analysts. The figure for August was revised down to 585,000.
- Sentiment in Europe’s manufacturing and services sectors is continuing to deteriorate at a fast pace. Europe-wide flash manufacturing purchasing managers’ index fell to 52.1 in October from 53.3, hitting a level not seen since July 2016 at the height of Brexit.
- Meanwhile, services PMI came in at 53.3, down from 54.7 in September, the lowest level since December 2016.
- Crude oil inventories are continuing to rise. For the week ended October 19, stockpiles grew by 6.3 million barrels, a sign of slowing demand. Oil inventories rose for the fifth consecutive week, after falling for five weeks in a row.
- The only bright spot this week is durable goods orders, which edged up 0.8% in September. Analysts had expected a fall of 1.3%. Core orders, which exclude volatile aircraft sales, rose 0.1%, an improvement compared with flat growth in August.
- German business confidence has dropped for the third consecutive month in October, with the Institute for Economic Research’s business sentiment gauge falling to 102.8 points from 103.7 in the prior month.
Risk Appetite Review
- Markets resumed their decline this week.
- The broad market (SPY ) is down 2.5% for the past five days.
- Risk assets (SPHB ) were the worst performers for the week, down 5.8%.
- Low volatility (SPLV ) provided somewhat of a refuge to investors, falling just 0.56%.
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Major Index Review
- Major indexes were all down.
- The small-cap index (IWM ) is the worst performer both for the week and the rolling month, down 4.09% and 12.31%, respectively.
- Dow Jones (DIA ), meanwhile, is the best performer as it is perceived as a relative safe haven. Dow Jones fell 1.75% for the week and 6.11% for the rolling month.
- To see how these indices performed a week before last, check out ETF Scorecard: October 19 Edition.
- Consumer staples (XLP ) were among the best performers for the week, and one of the few categories that posted gains, in part due to solid earnings reported by Procter & Gamble (PG). (XLP ) rose 1.48% for the week.
- The real estate sector (XLRE ) advanced 2.51%, representing the best performance for the week.
- The energy sector (XLE ) continued its downward slide this week, tumbling 6.73% due to weak oil prices.
- For the rolling month, utilities (XLU ) were the best performers, with a gain of 3.68%.
- Materials (XLB ) dived 14.52% for the past 30 days, dragged down by the poor performance of its biggest constituent, DowDuPont (DWDP), which dropped more than 20% for the rolling month.
Foreign Equity Review
- Chinese stocks (FXI ) have finally hit bottom, after experiencing losses for months due to international trade worries. Chinese officials tried to soothe investors by pledging financing support for private businesses. (FXI ) is the only gainer for the week, up 0.38%.
- Meanwhile, Japanese equities (EWJ ) have dropped the most for the week, down 3.83%, as foreigners dumped the country’s equities amid rising interest rates in the U.S.
- Germany (EWG ) fell nearly 12% for the rolling month, the worst performer.
- Brazil (EWZ ) continued to be the best monthly performer, with a rise of 21.04%.
- To find out more about ETFs exposed to particular countries, use our ETF Country Exposure tool. Select a particular country from a world map and get a list of all ETFs tracking your pick.
- Commodities were mixed.
- Gold (GLD ) was the best performer for the week with a tepid advance of 0.15%.
- Oil (USO ) is the worst performer for the second consecutive week, this time falling 3.2%, as increasing stockpiles in the U.S. stoked fears of slowing demand. Oil is also the worst performer for the rolling month, down 7.25%.
- Natural gas (UNG ) surged more than 5% for the past 30 days, claiming the top performer spot.
- The U.S. dollar (UUP ) is again the best performer for the week, up 0.82%, as higher Treasury yields attract money flows in the U.S. The greenback is also the best performer for the rolling month, up 3%.
- Euro (FXE ) is the worst performer for the week and the rolling month, despite the European Central Bank recently pledging to withdraw stimulus measures as planned. (FXE ) is down 1.79% for the week and 3.54% for the past 30 days.
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Disclosure: No positions at time of writing.