The market was exposed to more of the same this week: geopolitical tensions between Russia and Ukraine and the Federal Reserve's potential response to it. Stocks saw one day of respectable gains this week which came Tuesday when it seems tensions were easing at the Ukrainian border when Russia claimed it was pulling back troops. Those reports were claimed to be false the following day and it seemed the troops were rather added. By the end of the week the C-fund gave up 1.52% while the S-fund lagged with a 2.11% loss.
The relationship between the Russia/Ukraine conflict and the Federal Reserve Bank is all tied up in inflation. The Federal Reserve has already been planning for aggressive monetary tightening. In the Fed minutes released this Wednesday they were prepared to set up a series of rate increases in the March, May, and June FOMC meetings. The Russia/Ukraine conflict adds yet another threat of elevated inflation. In the case of an invasion and war, commodities tied to the two countries, including oil, will see a price increase. The news continues to suggest an invasion is imminent, so the question now is how an already hawkish Fed will react to this in their goal to slow inflation.
There has not been an invasion yet, so uncertainty is driving the markets down this week. Investors are in losing their appetite for risk as this tension carries on. The question is how will stock prices react to an actual invasion? Fresh volatility will be pumped into the market but there is also potential for new clarity on the situation combined with an already sold off market to get buyers attracted to stocks again.
Some financial markets will be closed on Monday, February 21 in observance of the Washington's Birthday holiday. The Thrift Savings Plan will also be closed. Transactions that would have been processed Monday night (February 21) will be processed Tuesday night (February 22), at Tuesday's closing share prices.
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 February 18:
The SPY (S&P 500 / C-fund) hit its high this week when reaching its 20-day EMA on Tuesday. A declining trend line was also in line with the price action. The ETF eventually slipped back below its 200-day EMA for the first time since January. Its lows of the week matched up with the closing low of January. The C-fund fell 1.52% for the week.
The Dow Completion Index (S-fund) traded above its 20-day EMA early in the week but slipped below Thursday and fell deeper Friday. The lows of this week were on par with the lows of the first week of February. The S-fund lagged the TSP funds with a 2.11% loss which is a change of pace this month after small caps continually outperformed large caps this month prior to this week.
EFA (EAFE Index / I-fund) was down and below its 200-day EMA after giving up early gains and filling an open gap. However the I-fund was down just 0.45% while U.S. funds were both down more than 1.5%.The I-fund gave up its gains for February this week to officially put every TSP fund outside of the G-fund into losses for February.
BND (Bonds / F-fund) was down early in the week and closed at its low on Tuesday but could not recover the early losses through the rest of the week. The F-fund was down 0.23% for the week. Three open gaps lie above.
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
Last Look Report
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 relationship between the Russia/Ukraine conflict and the Federal Reserve Bank is all tied up in inflation. The Federal Reserve has already been planning for aggressive monetary tightening. In the Fed minutes released this Wednesday they were prepared to set up a series of rate increases in the March, May, and June FOMC meetings. The Russia/Ukraine conflict adds yet another threat of elevated inflation. In the case of an invasion and war, commodities tied to the two countries, including oil, will see a price increase. The news continues to suggest an invasion is imminent, so the question now is how an already hawkish Fed will react to this in their goal to slow inflation.
There has not been an invasion yet, so uncertainty is driving the markets down this week. Investors are in losing their appetite for risk as this tension carries on. The question is how will stock prices react to an actual invasion? Fresh volatility will be pumped into the market but there is also potential for new clarity on the situation combined with an already sold off market to get buyers attracted to stocks again.
Some financial markets will be closed on Monday, February 21 in observance of the Washington's Birthday holiday. The Thrift Savings Plan will also be closed. Transactions that would have been processed Monday night (February 21) will be processed Tuesday night (February 22), at Tuesday's closing share prices.
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 February 18:
The SPY (S&P 500 / C-fund) hit its high this week when reaching its 20-day EMA on Tuesday. A declining trend line was also in line with the price action. The ETF eventually slipped back below its 200-day EMA for the first time since January. Its lows of the week matched up with the closing low of January. The C-fund fell 1.52% for the week.
The Dow Completion Index (S-fund) traded above its 20-day EMA early in the week but slipped below Thursday and fell deeper Friday. The lows of this week were on par with the lows of the first week of February. The S-fund lagged the TSP funds with a 2.11% loss which is a change of pace this month after small caps continually outperformed large caps this month prior to this week.
EFA (EAFE Index / I-fund) was down and below its 200-day EMA after giving up early gains and filling an open gap. However the I-fund was down just 0.45% while U.S. funds were both down more than 1.5%.The I-fund gave up its gains for February this week to officially put every TSP fund outside of the G-fund into losses for February.
BND (Bonds / F-fund) was down early in the week and closed at its low on Tuesday but could not recover the early losses through the rest of the week. The F-fund was down 0.23% for the week. Three open gaps lie above.
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
Last Look Report
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.
