Commentary

Equities: The major stock indexes maintained their uptrends and spent most of the week consolidating their gains and establishing support. For the week, they were up as follows: SP-500 (SPY) +0.26%; Nasdaq-100 (QQQ) +0.81%, and Russell-2k (IWM) +0.63%.

Volatility: The VIX (VXX) closed down -6.88% for the week and violated the support it had established over the previous three weeks of trading.

Bonds: Even though treasury bonds have staged valiant rallies over the past two weeks and closed at the upper end of their trading range, they continue to struggle with climbing above the bearish channel in which they are entrapped. The 20+ Year Treasury ETF (TLT) was down -0.98% for the week.

Currencies: This week witnessed a changing of the guard in terms of leadership amongst the major currencies. The Euro’s usurpation of the Dollar was short lived, i.e. approximately six weeks. Those roles have been reversed. The U.S. Dollar (UUP) was up +3.14% and the Euro (FXE) sank -3.88%. The Japanese Yen (FXY) was more reserved in its reaction and declined only -1.85% for the week.

Commodities: The rise in the dollar made a negative impact on this asset class as well. For the week, the DB Commodity Index (DBC) was down -2.49%; Gold (GLD) was off -1.64%; and Oil (USO) pulled back -1.32%.

Real Estate: The Dow Jones Real Estate Index (IYR) continued to consolidate support while closing -1.07% for the week. The Home Construction Index (ITB) surged earlier in the week and then closed at the lower end of its weekly trading range, managing a gain of only +0.52%.

ETF Capital Markets Performance Summary

May-22-2015

Market Moving Events

Bullish

• N/A

Bearish

• Inflation / USA: The Consumer Price Index for April 2015 contracted a little and was less than expected @ 0.1% vs. consensus @ 0.2% and prior revised @ 0.2% month-over-month. Annualized, it declined -0.2% vs. prior @ 0%. The report didn’t leave inflation hawks much to sink their talons into, in case anyone is expecting aggressive tightening from central bankers.

Neutral

• Central Banks / Janet Yellen Speach: Fed Chairperson Janet Yellen spoke today and notified all that the Central Bank will be raising rates at some point this year but does not forsee it returning to a normalized monetary policy for a few years, given the current softness in the economy and other data dependent considerations. The markets were not really shocked by any of this and therefore her words had little, if any, impact on asset classes.