BVA Value Momentum Portfolio Strategy - Year-to-Date Performance as of January 31, 2020/Market Commentary
BVA Value Momentum Portfolio Strategy - Year-to-Date
Performance as of January 31, 2020:
Since the start of the portfolio on January 2, 2019, the BVA
Value Momentum Portfolio Strategy return is up 163.48% compared to an increase
of 26.10% for the Morningstar US Market Index.
The stocks on the strategy list currently have a price to
fair value of .77 vs 1.04 for the Morningstar coverage universe.
Market and Economic Commentary - Week Ending 01/31/2020
Virtually all global stock market and commodity indexes were
down for a second week in a row. There was a continued flight to safety for the
week as US Treasuries, Gold and the VIX were about the only asset classes to
rise for the week. The VIX, or Fear Index, again registered the largest gain and
the Baltic Dry Index registered the largest loss for the second consecutive
week.
Returns in the Markets for the week ending 01/31/2020 were
as follows:
The Dow Jones Industrial Average is down 2.53% for the week.
The S&P 500 is down 2.12%, the NASDAQ index is down 1.76%, and the US Small-Cap
index is down 2.88%. The CBOE Volatility Index (VIX), or Fear Gage, was up 29.40%
for the week and was by far the largest increase in any asset class for the
week for the second week in a row.
US Major Market Indexes Year-to-Date
The Dow Jones Industrial Average is down 0.99% Year-to -Date.
The S&P 500 is down 0.16%, the NASDAQ index is up 1.99%, and the US
Small-Cap index is down 3.24%. The CBOE Volatility Index (VIX), or Fear Gage, is
up 36.72% Year-to-Date, by far the largest increase in any asset class for year
so far.
US Sector ETFs (The
first number is each category in the 1-week performance. The second number is
the year-to-date performance)
Communication Services (-3.20%,
+0.52%). Consumer Discretionary (-0.50%, -0.08%). Consumer Staples (-0.64%,
+0.32%). Energy (-5.62%, -10.99%). Financial (-1.41%, -2.66%). Health Care
(-3.24%, -2.67%). Industrials (-2.92%, -0.44%). Materials (-3.53%, -6.17%). Real Estate (-1.90%, +1.45%).
Technology -2.155%, +3.99%). Utilities (+0.91%, +6.75%).
Global Market ETFs (The first number is each
category in the 1-week performance. The second number is the year-to-date
performance)
ACWI
all-country World index (-2.69%, -1.44%). ACWX all-country World index ex US
(-3.38%, -3.42%). AAXJ all-country Asia ex Japan (-3.53%, -6.30%). EZU Eurozone (-2.72%,
-3.44%). ILF Latin America (-5.38%,
-7.86%). EEM Emerging Markets (-5.68%, -6.15%).
The
following major country indexes are shown in the order of the highest average
daily trading volume:
China (-6.16%, -6.92%). Brazil (-5.87%,
-7.78%). Japan (-2.99%, -2.62%).
Russia (-4.87%, -1.48%). Taiwan (-6.46%, -7.71%). India (-3.09%,
-1.88%). South Korea (-8.35%, -7.30%). Germany (-3.71%, -2.96%). Australia (-4.26%, -1.68%). Mexico
(-2.18%, +1.84%). Spain (-0.81%,
-3.15%). France (-2.64%, -4.00%). Italy (-2.01%. -2.44%).
Commodities (The
first number is each category in the 1-week performance. The second number is
the year-to-date performance)
Most Commodities were down for the week. Significant
movers were:
Precious Metals – Gold (+1.07%, +4.31%). Silver (-0.47%,
+0.59%) Platinum (-4.71%, -0.95%). Palladium (-4.51%, +15.96%).
Energy – Crude (-4.74%, -15.46%). Brent Oil (-6.66%,
-14.17%) Natural Gas (-2.50%, -15.70%), Heating Oil (-6.18%, -15.76%). Gasoline (-1.17%, -11.80%).
Industrial Metals – Aluminum (-3.25%, -3.55%). Zinc (-5.59%,
-2.38%). Lead (-3.04%, -2.38%). Nickel (-1.52%, -9.07%). Copper (-6.15%, -9.88%).Tin (-2.36%, -4.05%).
Agriculture – Corn (-1.39%, -1.51%). Soybeans (-3.27%,
-7.51%). Wheat (-3.21%, -1.07%). Rice
(+0.55%, +4.00%). Cotton (-2.96%, -2.26%). Coffee (-7.17%, -21.16%).
Livestock – Live Cattle (-2.78%, -2.67%). Lean Hogs
(-15.41%, -20.36%). Feeder Cattle (-3.95%, -0.24%).
Commodity ETF Indexes – DBC Commodity Tracker (-3.51%,
-8.59%). BDRY Breakwave Dry Bulk
Shipping (-11.81%, -36.44%).
Bond Market
In the bond market, the 10-year US Treasury interest rate
went from 1.686% on January 24 to 1.505% on January 31, for a percentage drop
of 10.74% for the week. As of January 31, the 1 month US Treasury was at 1.56%,
and the 3 month was at 1.55% vs the 10 Year Treasury of 1.505%. The this has
resulted in a slight inversion of the yield curve, which bears close watching.
Currencies
In currencies, the US Dollar DXY Index went from 97.650 on
January 24 to 97.183 on January 31.
Other Significant Events
Dow Drops 600 Points Friday on Global Growth Concerns
U.S. stocks capped off a turbulent week with a punishing
selloff as the spreading coronavirus outbreak fanned fears about global
economic growth. The Dow Jones Industrial Average dropped more than 600 points
Friday -- its steepest one-day loss since August -- while the S&P 500 and
Nasdaq Composite both fell more than 1.5%. All three indexes suffered their
worst January since 2016.
Anxiety swept through the stock, bond and commodities
markets on uncertainty about the scope of the economic impact of the coronavirus
in China, as airlines suspended flights to and from the country and businesses
shut down their operations there.
Oil prices have been hit particularly hard, with U.S.
crude is at the lowest level since early August. The CBOE Volatility Index
recorded its biggest January jump on record, a sign of the fear in the markets.
The Baltic index, which measures the cost of shipping
goods around the world, slumped 19 points, or 3.3%, to 557 points on Friday, a
level not seen since April 2016, as weaker demand was reported for all vessel
categories. regulations led to a significant rise in the cost of operating
cargo ships.
Investors reached for traditionally safer assets like
Treasuries and gold. Demand for Treasuries pushed the yield on the 10-year note
to 1.521%, nearing 2016's record low, while gold prices hovered near the
highest level in almost seven years.
Investors have soured on the market in the past two weeks,
a reversal from the first two weeks of the year when they piled into stocks on
optimism that global growth could rebound.
The World Health Organization on Thursday declared the
coronavirus -- which has now sickened more than 9,500 people and killed over
200 -- a public-health emergency of international concern.
In one sign of the growth worries, the yield on the
benchmark 10-year U.S. Treasury note edged back below the yield of the
three-month bill this week. The phenomenon, known as a yield-curve inversion,
is often interpreted as a warning sign about a recession ahead.
Meanwhile, new data Friday showed that business activity
faltered. One measure, the Chicago Business Barometer, fell to its lowest point
in about four years, hitting 42.9 and falling well below expectations. Readings
under 50 indicate activity is contracting.
Although manufacturing data has disappointed recently, the
U.S. consumer continues to spend, restoring some faith in the decadelong
economic expansion. Fresh data released Friday showed household spending rose a
seasonally adjusted 0.3% in December from November. Personal income advanced
0.2% last month.
Thank
you and please stay tuned for more upcoming reports.
Thank
you and please stay tuned for more upcoming reports.
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Len Martinez is a Financial Consultant. Information in the
"Bull Valley Advisor” newsletter should not be considered as investment
advice or an offer to buy or sell securities. Data is derived from sources
considered to be reliable including Morningstar, StockCharts.com, YAHOO
Finance, FINVIZ, TipRanks, Investing.com, ECRI OCED, gurufocus, Crestmont
Research, Trading Economics and S2O. Results are not guaranteed. Len Martinez
is not an RIA. The data is shown for informational purposes and should not be
considered investment advice or an offer to buy or sell securities.
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