Commentary

Today’s market was a narrative of risk and flight to safety. The market is finally coming to terms with the realization that interest rates will be going up sometime before yearend despite Fed Chairperson Yellen’s pledge to be patient over a period of at least several years before returning to a normal monetary policy or Fischer’s remarks today that interest rate decisions would also be dependent upon the strength of the global economy as well. Compounding fears even further is the sovereign risk of Greece defaulting on its debt and being the tipping point that leads to the collapse of the EU as its departure would establish a dangerous precedent for other fiscally weak countries to follow.

When risks no longer looks good and there’s something strange in your neighborhood, you don’t call Ghostbusters. Instead you call on Volatility (VIX) to lead the way. He ain’t afraid of no ghost either, especially with backup from his other friends charging ahead into positive territory, i.e. Treasury Bonds  (TLT) and Currencies/U.S. Dollar (UUP). Gold (GLD) lost its lustre and Oil (USO) is finding it harder to climb the slick slippery slopes of an oversupplied market and contracting demand as evidenced by the U.S. Fed Dallas Manufacturing Survey. One might think that the stronger than expected Case-Shiller Home Price Index or New Home Sales reports would spare Real Estate assets (IYR and ITB) but such was not the case.

My last comments are reserved for Equities. The SP-500 (SPY), Nasdaq-100 (QQQ) and Russell-2k (IWM) ceded all of last week’s entire gains in today’s trading session. Fortunately, those gains didn’t amount to a hill of beans so there is no cause for alarm yet. Most importantly, all three major stock indexes have held the support of their lower bullish channel uptrend line. Let’s see if we can get a bounce tomorrow…

ETF Capital Markets Performance Summary

Market Moving Events

Bullish

• n/a

Bearish

• n/a

Neutral

• n/a