There will be no commentary report this evening. However, there were quite a few breakouts in the equities asset class. So, enjoy the rest of the story! (See comments below…)
Asset Class Performance Summary and Analysis
Equities: All four of our major US stock index averages (SPY, DIA, QQQ, & IWM) achieved impressive breakouts above short-term resistance levels. Europe (VGK) and EAFE (EFA) did as well. Latin America (ILF and EWZ) continues to outperform the market, but stronger than expected economic export data out of China boosted China (FXI) and Asia Ex-Japan (EPP). Another area of strength was Japan (EWJ), which may be due for a recovery rally as the Yen (FXY) is showing signs of may finally be retreating from its strong advance. The VIX (VXX) gapped down with a loss of more than five percent.
Sectors: Leaders for the day were Financials (XLF), Industrials (XLI) and Information Technology (VGT). Laggards were Utilities (XLU) and Consumer Staples (XLP).
Fixed Income and Bonds: In reviewing the performance of fixed income assets lately, it is evident that the risk trade is on. This is being confirmed by the breakout in High Yield Bonds (HYG).
Currencies: The US Dollar (UUP) has initiated a bullish reversal while the Euro (FXE) and Yen (FXY) are now in correction mode.
Commodities: Gold (GLD) has initiated its own pullback as well as the dollar takes the lead. US Oil Fund (USO) and DB Commodities Index (DBC) also stalled today and may be encountering resistance at these levels.
Real Estate: The commercial and residential real estate indexes (IYR and REZ) are consolidating at these current resistance levels while Home Construction (ITB) is assuming leadership amongst real estate correlated assets.