Stocks stretched higher Friday keeping the recovery rally intact. This week was a back and forth battle for momentum between those optimistic about the economy's recovery and those who think the real damage has yet to come. The prospect of reopening businesses and flipping the economy switch back on has many hopeful that what once was will be again soon. The Federal Reserve and the government have dumped unprecedented amounts of stimulus into banks, businesses, and directly to the consumer to make that recovery possible; as an investor that's hard to ignore.
The other side of the coin are the alarming lagging numbers of job losses, closed businesses, retail consumer activity plummeting, and the shadow of uncertainty of whether consumers will want to go back to normal so easily. With this all and more lingering over investors' heads some find entry points more difficult to find when the rug could be pulled from underneath them once again. Stock prices did stagger a good amount this week and it was the rally Friday kept the rally alive but we're entering earnings season where investors resilience may be tested.
Earnings are going to be ugly but what will that really mean for someone looking for somewhere to put their money. Bond yields seem hardly worth it anymore and although the bond market recovered from its fallout its been glued together by the Federal Reserve bond buying programs. Bonds were up this week with stocks but with the Fed already all in its worth questioning if bonds can continue to be the safe haven.
All TSP funds were up for the week with the C-fund's 3.06% gain outperforming the rest.
Here are the weekly, monthly, and annual TSP fund returns for the week ending April 17th:
The SPY (S&P 500 / C-fund) looked to be at least flattening out this week but rally sparked Friday pushed the index to the top of it latest momentum channel. The 50-day has been surpassed and a test of the 200-day EMA seems like a plausible next move for the index. The only issue will be if earnings don't scare investors who have been optimistic lately. A test of the lows has been expected for weeks but it continues to grow into a larger feat every week. Three open gaps, including one produced Friday, are below the current price and a test of the lows would be nearly necessary to fill the lowest gap. The C-fund gained 3.06% for the week which was mostly fueled by Friday's rally.
The Dow Completion Indices (S-fund) also rallied Friday but had sank for the previous trading days that the rally gave was a recovery not so much a breakthrough to new grounds. The 50-day EMA has not been tested for the index and now has an open gap below the current price. The S-fund gained 0.84% for the week.
EFA (EAFE Index /I-fund) had a similar story as the S-fund. The gains are there but the wait of reality has more pressure for this index than large caps. The 20-day EMA did hold as support for the index this week, but the resistance of a month of trend line is keeping the fund from test its 50-day EMA so far. The I-fund was up 0.87% for the week.
AGG's (Bonds / F-fund) are climbing steadily this month and the trading channels are getting smaller; quite the change after the swings last month. For the moment bonds have kept investors interested in the face of the closed economy despite low yields. The F-fund gained 0.68% for the week.
Good luck and thanks for reading. We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.
Thomas A Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
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The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.
The other side of the coin are the alarming lagging numbers of job losses, closed businesses, retail consumer activity plummeting, and the shadow of uncertainty of whether consumers will want to go back to normal so easily. With this all and more lingering over investors' heads some find entry points more difficult to find when the rug could be pulled from underneath them once again. Stock prices did stagger a good amount this week and it was the rally Friday kept the rally alive but we're entering earnings season where investors resilience may be tested.
Earnings are going to be ugly but what will that really mean for someone looking for somewhere to put their money. Bond yields seem hardly worth it anymore and although the bond market recovered from its fallout its been glued together by the Federal Reserve bond buying programs. Bonds were up this week with stocks but with the Fed already all in its worth questioning if bonds can continue to be the safe haven.
All TSP funds were up for the week with the C-fund's 3.06% gain outperforming the rest.
Here are the weekly, monthly, and annual TSP fund returns for the week ending April 17th:
The SPY (S&P 500 / C-fund) looked to be at least flattening out this week but rally sparked Friday pushed the index to the top of it latest momentum channel. The 50-day has been surpassed and a test of the 200-day EMA seems like a plausible next move for the index. The only issue will be if earnings don't scare investors who have been optimistic lately. A test of the lows has been expected for weeks but it continues to grow into a larger feat every week. Three open gaps, including one produced Friday, are below the current price and a test of the lows would be nearly necessary to fill the lowest gap. The C-fund gained 3.06% for the week which was mostly fueled by Friday's rally.
The Dow Completion Indices (S-fund) also rallied Friday but had sank for the previous trading days that the rally gave was a recovery not so much a breakthrough to new grounds. The 50-day EMA has not been tested for the index and now has an open gap below the current price. The S-fund gained 0.84% for the week.
EFA (EAFE Index /I-fund) had a similar story as the S-fund. The gains are there but the wait of reality has more pressure for this index than large caps. The 20-day EMA did hold as support for the index this week, but the resistance of a month of trend line is keeping the fund from test its 50-day EMA so far. The I-fund was up 0.87% for the week.
AGG's (Bonds / F-fund) are climbing steadily this month and the trading channels are getting smaller; quite the change after the swings last month. For the moment bonds have kept investors interested in the face of the closed economy despite low yields. The F-fund gained 0.68% for the week.
Good luck and thanks for reading. We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.
Thomas A Crowley
www.tsptalk.com
Weekly Wrap-Ups Archive
Facebook | Twitter
The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.
