A wild week for stocks started with a 1.7% loss on Monday for the S&P 500 and ended with a 0.52% gain for the week. The main concern going into the week was the downfall of one of China's largest companies Evergrande. Evergrande is primarily a real estate company and property developer that used accumulating debt to keep operations moving forward. That debt ran above $300 billion and the Chinese government put restrictions on the company's borrowing. A good amount of the debt issuers are U.S. bond holders who were not paid interest on Thursday. Despite being the second largest company in the world and a slow down in growth means a slow down in global growth, China is reluctant to bail out the company or its bond holders. This in all put pressure on stocks late the previous week and early this week but investors bought the dip once it was clear the repercussions of Evergrande's collapse would not be felt immediately. In fact, even the unpaid interest payments would not default for a month.
This week also held the second to last FOMC meeting of the year. The Fed was accommodative to markets as usual and remained on their course of cutting bond purchases 'soon' and beginning its increase of interest rates sometime next year. This slow pace and continuation of kicking the can down the road was favored by investors. Wednesday and Thursday's rallies put stocks back into positive territory for the week. Friday was uneventful for such a twisted week but held onto gains in large caps late in the day to extend the S&P 500's winning streak to three days. The S-fund pulled back near 0.4% Friday but ended the week just under the C-funds performance. The I-fund was also down Friday but its losses gave up any gains for the week pushing the fund down 0.26% for the week.
Bonds switched gears following the FOMC meeting. The F-fund ended Wednesday with a 0.55% gain for the week then proceeded to sell off the last two days ending the week with a 0.39% loss.
Looking to next week the concern will be around the U.S. government debt ceiling. Congress has until September 30th (Thursday) to come to a deal to prevent a government shutdown that would pause most social programs helping the economy. As it stands, that seems likely to happen.
Looking for an edge on your TSP return? Get the Last Look Report for as low as $4.19 / month. The report is a daily email on the auto tracker moves, news, forum threads, and more before the IFT deadline. The service is aimed to help you make your own IFT decisions by giving you relative information 30 min prior to the deadline including where the members of TSP Talk are moving their money.
Here are the weekly, monthly, and annual TSP fund returns for the week ending September 24:
The SPY (S&P 500 / C-fund) gapped down below its 50-day EMA to start the week. The index slipped down to prices not seen since the mid-July dip but quickly came off those lows in the late hours of Monday's action. The open gap was nearly filled Wednesday but resistance from the 50-day EMA marked the highs of the day. That resistance was shrugged off and the index rallied Thursday above its 50 and 20-day EMAs. Those gains were topped Friday and the C-funded ended the wild week with a 0.52% to outperform the TSP funds.
The Dow Completion Index (S-fund) gapped down to start the week and fell 2.19% on Monday. In the next three days ending Thursday, the S-fund gained 3.14%. A pull back Friday of 0.39% ended the S-fund's week with a 0.48% gain. An open gap from August was filled. The index now sits above its 20-day EMA again.
EFA (EAFE Index / I-fund) had similar action a U.S. stocks but had a greater pull back Friday to actually end the week with a 0.26% loss. The losses on Friday also pushed the index below its 20 and 50-day EMAs.
BND (Bonds / F-fund) also had its own rollercoaster of action this week. BND gapped up to start the week and was back above its 20-day EMA and by Wednesday's close was up 0.55% for the week. Following investors digestion of the FOMC policy statement and the ongoing plan for the Fed to cut and eventually end its bond buying program, the index fell below its 50-day EMA Thursday and fell further below trend support almost down to the lows of August. The index closed the week out with a 0.39% loss to lag the TSP stock funds.
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
wwww.tsptalk.com
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.
This week also held the second to last FOMC meeting of the year. The Fed was accommodative to markets as usual and remained on their course of cutting bond purchases 'soon' and beginning its increase of interest rates sometime next year. This slow pace and continuation of kicking the can down the road was favored by investors. Wednesday and Thursday's rallies put stocks back into positive territory for the week. Friday was uneventful for such a twisted week but held onto gains in large caps late in the day to extend the S&P 500's winning streak to three days. The S-fund pulled back near 0.4% Friday but ended the week just under the C-funds performance. The I-fund was also down Friday but its losses gave up any gains for the week pushing the fund down 0.26% for the week.
Bonds switched gears following the FOMC meeting. The F-fund ended Wednesday with a 0.55% gain for the week then proceeded to sell off the last two days ending the week with a 0.39% loss.
Looking to next week the concern will be around the U.S. government debt ceiling. Congress has until September 30th (Thursday) to come to a deal to prevent a government shutdown that would pause most social programs helping the economy. As it stands, that seems likely to happen.
Looking for an edge on your TSP return? Get the Last Look Report for as low as $4.19 / month. The report is a daily email on the auto tracker moves, news, forum threads, and more before the IFT deadline. The service is aimed to help you make your own IFT decisions by giving you relative information 30 min prior to the deadline including where the members of TSP Talk are moving their money.
Here are the weekly, monthly, and annual TSP fund returns for the week ending September 24:
The SPY (S&P 500 / C-fund) gapped down below its 50-day EMA to start the week. The index slipped down to prices not seen since the mid-July dip but quickly came off those lows in the late hours of Monday's action. The open gap was nearly filled Wednesday but resistance from the 50-day EMA marked the highs of the day. That resistance was shrugged off and the index rallied Thursday above its 50 and 20-day EMAs. Those gains were topped Friday and the C-funded ended the wild week with a 0.52% to outperform the TSP funds.
The Dow Completion Index (S-fund) gapped down to start the week and fell 2.19% on Monday. In the next three days ending Thursday, the S-fund gained 3.14%. A pull back Friday of 0.39% ended the S-fund's week with a 0.48% gain. An open gap from August was filled. The index now sits above its 20-day EMA again.
EFA (EAFE Index / I-fund) had similar action a U.S. stocks but had a greater pull back Friday to actually end the week with a 0.26% loss. The losses on Friday also pushed the index below its 20 and 50-day EMAs.
BND (Bonds / F-fund) also had its own rollercoaster of action this week. BND gapped up to start the week and was back above its 20-day EMA and by Wednesday's close was up 0.55% for the week. Following investors digestion of the FOMC policy statement and the ongoing plan for the Fed to cut and eventually end its bond buying program, the index fell below its 50-day EMA Thursday and fell further below trend support almost down to the lows of August. The index closed the week out with a 0.39% loss to lag the TSP stock funds.
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
wwww.tsptalk.com
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.
