Stocks got a boost early in the week setting up what became the best weekly gains for the S&P 500 since early February. Fears of the covid variant Omicron's potential sparked selling early in the month and those fears subsided this week with data suggesting the strain is less damaging as originally thought. The large cap index stabilized after Tuesday's gains and eventually ended the week at new all-time highs for the C-fund. The small cap index gave up some the early gains as it was down the last two days of the week including a 2.28% loss on Thursday. The large cap indices have the outperforming larger companies to keep the index up even when the less weighted smaller companies are not performing well.
The Consumer Price Index came out Friday reporting a 6.8% in prices compared to the previous November. This was the largest gain for the CPI report in nearly 40 years but stocks were not discouraged as it happens to come in at expectations.
A divergence has grown between the large cap indices and the small cap indices; small caps are reaching bear market status while large caps, like S&P500, are reaching new highs. This could set up a rotation back into small caps if the market and economy can grow long-term optimism within investors.
The Federal Reserve's Open Market Committee will meet next week and have decisions to make about whether to accelerate the tapering of bond purchases than originally planned to give them more freedom to raise interest rates when needed. There is growing pressure on the Fed to combat the rate of inflation and the Fed is starting to publicly express their own concerns. The idea is to use higher interest rates to slow down demand and give the supply end of the economy a chance to catch up. However, there are other dynamics to the rise in prices that is out of the Federal Reserve's hands.
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 TSP AutoTracker 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 December 10:
The SPY (S&P 500 / C-fund) started the week below its 50-day EMA but was up 3.27% in just the first two days of the week. The rally cooled off the last three days but the C-fund was able to end the week and new all-time highs and back above its 20-day EMA.
The Dow Completion Index (S-fund) outperformed large caps to start the week; the S-fund was up 5.19% in first three days. The index would sell off the next two days including the 2.28% loss on Thursday and another 0.50% loss Friday. This brought the S-fund's gains to 2.28% for the week. Friday's losses filled the open gap produced from Tuesday's open and put the index back below its 200-day EMA.
EFA (EAFE Index / I-fund) was also up more than 3.00% by the end of Wednesday and had produced an open gap from Tuesday's open. The index pulled back Thursday and Friday to bring the weekly gain to 2.43% to outperform the S-fund. The top of the open gap acted as support along with the 20-day EMA on Thursday and Friday.
BND (Bonds / F-fund) pulled back while stocks rallied early in the week. The index came off its Wednesday's lows a little but not to recoup much of damage done. The 20, 50, and 200-day EMAs are all around the same price right now and Friday's close was just below that. The F-fund fell 0.72% for the week lagging the TSP funds and the only weekly loss for the TSP 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.
The Consumer Price Index came out Friday reporting a 6.8% in prices compared to the previous November. This was the largest gain for the CPI report in nearly 40 years but stocks were not discouraged as it happens to come in at expectations.
A divergence has grown between the large cap indices and the small cap indices; small caps are reaching bear market status while large caps, like S&P500, are reaching new highs. This could set up a rotation back into small caps if the market and economy can grow long-term optimism within investors.
The Federal Reserve's Open Market Committee will meet next week and have decisions to make about whether to accelerate the tapering of bond purchases than originally planned to give them more freedom to raise interest rates when needed. There is growing pressure on the Fed to combat the rate of inflation and the Fed is starting to publicly express their own concerns. The idea is to use higher interest rates to slow down demand and give the supply end of the economy a chance to catch up. However, there are other dynamics to the rise in prices that is out of the Federal Reserve's hands.
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 TSP AutoTracker 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 December 10:
The SPY (S&P 500 / C-fund) started the week below its 50-day EMA but was up 3.27% in just the first two days of the week. The rally cooled off the last three days but the C-fund was able to end the week and new all-time highs and back above its 20-day EMA.
The Dow Completion Index (S-fund) outperformed large caps to start the week; the S-fund was up 5.19% in first three days. The index would sell off the next two days including the 2.28% loss on Thursday and another 0.50% loss Friday. This brought the S-fund's gains to 2.28% for the week. Friday's losses filled the open gap produced from Tuesday's open and put the index back below its 200-day EMA.
EFA (EAFE Index / I-fund) was also up more than 3.00% by the end of Wednesday and had produced an open gap from Tuesday's open. The index pulled back Thursday and Friday to bring the weekly gain to 2.43% to outperform the S-fund. The top of the open gap acted as support along with the 20-day EMA on Thursday and Friday.
BND (Bonds / F-fund) pulled back while stocks rallied early in the week. The index came off its Wednesday's lows a little but not to recoup much of damage done. The 20, 50, and 200-day EMAs are all around the same price right now and Friday's close was just below that. The F-fund fell 0.72% for the week lagging the TSP funds and the only weekly loss for the TSP 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.
