Courtesy of renjith krishnan / FreeDigitalPhotos.net

Courtesy of renjith krishnan / FreeDigitalPhotos.net

U.S. Markets Doing Well, Relatively

If investors around the world were voting on their favorite stock market, there is little doubt U.S. markets would finish near the top. Barron’s explained, “For the past three years, Wall Street has been trouncing the world’s other markets, inducing investors to pile in and bail on other assets.”

So, how popular are U.S. markets? The Standard & Poor’s 500 Index (S&P 500) has not moved lower for four consecutive days during 2014, according to experts cited by Barron’s. That breaks S&P 500’s previous record for longest period in a calendar year without four down days in a row which happened in 1997. The streak ended in late August of that year.

In September, more than $164 billion were invested in the United States by investors at home and abroad. The reason investors are attracted to U.S. markets is no secret. Last week’s economic data may have been mixed, but it didn’t change the fact U.S. economic growth has been relatively strong. Third quarter’s gross domestic product – the value of all goods and services produced in the United States – was revised higher last week from 3.5 percent to 3.9 percent. Both readings were above the consensus estimate of 3.3 percent. That’s pretty strong growth compared to some other countries:

“While U.S. gains have been modest compared with previous expansions, domestic growth is outpacing other advanced economies. Japan’s economy slipped into a recession in the third quarter and the eurozone’s growth barely stayed positive. The rate of growth in emerging markets from China to Brazil is also slowing,” reported The Wall Street Journal.

Although U.S. economic growth during the middle quarters of 2014 was the fastest in a decade, The Wall Street Journal suggested the improvement might be a modest acceleration rather than a major breakout. They cautioned U.S. exports and military spending made attractive contributions to third quarter growth, but that could change if there is a global slowdown or the government cuts military budgets.


Data as of 11/28/14

1-Week

Y-T-D

1-Year

3-Year

5-Year

10-Year

Standard & Poor’s 500 (Domestic Stocks)

0.2%

11.9%

14.5%

20.1%

13.5%

5.8%

10-year Treasury Note (Yield Only)

2.2

NA

2.7

2.0

3.2

4.3

Gold (per ounce)

-1.8

-1.6

-5.0

-11.6

0.1

10.1

Bloomberg Commodity Index

-4.4

-10.2

-9.1

-7.6

-3.7

-3.1

DJ Equity All REIT Total Return Index

1.8

26.4

27.2

19.3

18.0

8.7

S&P 500, Gold, DJ-UBS Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; the DJ Equity All REIT TR Index does include reinvested dividends and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods. Sources: Yahoo! Finance, Barron’s, djindexes.com, London Bullion Market Association.

*The Standard & Poor’s 500 (S&P 500) is an unmanaged group of securities considered to be representative of the stock market in general. Unmanaged index returns do not reflect fees, expenses, or sales charges. Index performance is not indicative of the performance of any investment.  You cannot invest directly in this index.

* The 10-year Treasury Note represents debt owed by the United States Treasury to the public. Since the U.S. Government is seen as a risk-free borrower, investors use the 10-year Treasury Note as a benchmark for the long-term bond market.

* Gold represents the London afternoon gold price fix as reported by the London Bullion Market Association.

* The DJ Commodity Index is designed to be a highly liquid and diversified benchmark for the commodity futures market. The Index is composed of futures contracts on 19 physical commodities and was launched on July 14, 1998.

* The DJ Equity All REIT TR Index measures the total return performance of the equity subcategory of the Real Estate Investment Trust (REIT) industry as calculated by Dow Jones.

* Yahoo! Finance is the source for any reference to the performance of an index between two specific periods.

* Opinions expressed are subject to change without notice and are not intended as investment advice or to predict future performance.

* Economic forecasts set forth may not develop as predicted and there can be no guarantee that strategies promoted will be successful.

 

Sources:

http://online.barrons.com/articles/better-investment-bets-are-1417241145?mod=BOL_hp_we_columns (or go to http://peakclassic.peakadvisoralliance.com/app/webroot/custom/editor/12-01-14_Barrons-US_Stocks-Too_Popular-Footnote_1.pdf)

http://online.barrons.com/articles/dow-hits-another-record-high-as-oil-plunges-1417239392?mod=BOL_hp_we_columns (or go to http://peakclassic.peakadvisoralliance.com/app/webroot/custom/editor/12-01-14_Barrons-Dow_Hits_Another_Record_High-Footnote_2.pdf)

http://online.wsj.com/articles/u-s-third-quarter-gdp-revised-up-to-3-9-advance-1416922352 (or go to http://peakclassic.peakadvisoralliance.com/app/webroot/custom/editor/12-01-14_WSJ-Amid_Global_Slowdown_US_Growth_Keeps_Looking_Better-Footnote_3.pdf)