The shortened week brought inconsistency and a lack of persistent momentum by the bulls or bears. A sell off Thursday had the indices set for weekly losses but a rebound Friday pushed the S&P 500 to new highs and cut small cap losses. Volatility perked up this week from the prior week and the struggle for direction was finally won by the bulls but the day to day inconstancy has to have investors questioning what next week will bring.
Big tech names have been major drivers of gains for the large cap indices. President Biden put an executive order into action Friday that is aimed to limit these major companies hold on the tech market. However, the stock prices of these tech giants were not much effected by the news. There was not much new added in the executive order that is not already in place, but Biden called on regulators to get more strict with rules already in place.
Next week the focus will be on earnings, especially on the big bank names. There seems to still be plenty of money to be put to work and the long term momentum of stocks is growing harder to ignore for those holding onto that cash.
The I-fund outperformed the TSP funds this week with a 0.61% gain and the C-fund was behind with a 0.42% gain. The S-fund lagged the TSP funds with a 0.41% loss for the week despite outperforming on Friday's rebound. The F-fund was up 0.29% but came off its highs Friday erasing more than half of the weekly gains produced by Thursday's close.
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Here are the weekly, monthly, and annual TSP fund returns for the week ending July 9:
The SPY (S&P 500 / C-fund) produced a new high Wednesday but was down 0.7% by the end of Thursday. Dip buyers were quick to buy into Friday and the rallied 1.13% on the day. This rallied pushed the index to new all time highs and the C-fund finished the week with a gain of 0.42%.
The Dow Completion Index (S-fund) fell below rising support this week. Friday's rebound rally was capped off where the rising support and a couple peaks of the last few months met. Despite closing near the highs of Friday's rally and gaining 1.92% on the day, the S-fund fell short for the week and lagged the TSP funds with a loss of 0.41%. This was the only loss in the TSP funds for the week.
EFA (EAFE Index / I-fund) traded down early around the 50-day EMA but below the 20-day EMA. The index gapped down Thursday but followed Friday with a gap up and rally to put the current price back above that 20-day EMA it has struggled stay above since early June. Friday's rally finished the I-funds week with a 0.61% gain to outperform the TSP funds.
BND (Bonds / F-fund) closed the gap that had been open since February this week. The index carried higher from there but hit a peak Thursday while stocks were selling off. Bonds finished the week pulling back as the F-fund lost 0.34% on Friday. This cut the fund's gains to 0.29% 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
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