Weekly Commentary, 11/30/15 – 12/4/15
The S&P 500 Index closed modestly lower on Monday, the last day of November, finishing the month essentially unchanged and up about 1.50% for the year.
On Tuesday, the broad market averages resumed their rallies, due in part to a rebound in retail shares on strong Cyber Monday data as well as encouraging auto sales numbers. The S&P 500 Index traded sharply higher, about 1%, closing back above the 2,100 level.
On Wednesday the markets reversed Tuesday’s gain losing approximately 1%, dragged down by Energy shares due to lower oil prices. Also, Federal Reserve Chair Yellen shared commentary that many deemed a bit more hawkish than expected, as she pointed specifically to interest in seeing the U.S. enter a situation of higher rates.
Market declines continued into Thursday. Investors seemed disappointed over a smaller-than-expected round of monetary stimulus from the European Central Bank. The euro rallied 3.1% against the Dollar. The S&P 500 Index fell 1.4%, and the yield on the benchmark U.S. 10-year Treasury note rose 0.15 basis points to 2.33%.
Stocks were in rally mode on Friday as Mario Draghi, President of the European Central Bank, speaking in New York, attempted to undo some of the market impact from Thursday’s announcement. The central bank would “no doubt” step up stimulus measures if needed. Hidden in the week’s back and forth price action and Friday’s 2% gain, the U.S. equity markets closed virtually unchanged. The S&P 500 closed just under 2100, above its 200 day moving average, after bouncing off its 50 day moving average on Thursday. The Dow Jones Index and the NASDAQ Composite posted similar price action. The Russell 2000 Index is the only major average that remains below its 200 day moving average.
The Stadion Managed Account Risk objectives are managed using a “core/satellite” approach. The core positions will comprise 40-60% of the portfolio and are invested in equity, fixed income and money market instruments with the strategic allocation becoming more risk averse as the risk tolerance of each fund changes. In allocating the objective’s satellite assets the remaining 40-60% of each portfolio, Stadion uses a proprietary, rules based weight of the evidence model. Based on continued improvement in the weight of the evidence in the Stadion Dynamic Trend model the portfolios are fully invested per the respective risk objectives.
Past performance is no guarantee of future results. Investments are subject to risk, and any of Stadion’s investment strategies may lose money. The investment strategies presented are not appropriate for every investor and financial advisors should review the terms and conditions and risks involved. Stadion’s actively managed portfolios may underperform during bull markets. Some information contained herein was prepared by or obtained from sources that Stadion believes to be reliable. There is no assurance that any of the target prices or other forward-looking statements mentioned will be attained. Any market prices are only indications of market values and are subject to change. The euro is the official currency of the eurozone, which consists of 19 of the 28 member states of the European Union. The U.S. 10-Year Treasury Note is a debt obligation issued by the United States government that matures in 10 years. The S&P 500 Index is the Standard & Poor’s Composite Index of 500 stocks and is a widely recognized, unmanaged index of common stock price. The NASDAQ Composite is a stock market index of the common stocks and similar securities listed on the NASDAQ stock market and it is highly followed in the U.S. as an indicator of the performance of stocks of technology companies and growth companies. The Dow Jones Industrial Average is a price-weighted average of 30 significant stocks traded on the New York Stock Exchange and the NASDAQ. The Russell 2000 Index is a small-cap stock market index of the bottom 2,000 stocks in the Russell 3000 Index. It is the most widely quoted measure of the overall performance of the small-cap to mid-cap company shares. It is not possible to invest directly in indexes (like the S&P 500) which are unmanaged and do not incur fees and charges. The Sharpe ratio measures the excess return per unit of deviation, or risk. Any references to specific securities or market indexes are for informational purposes only. They are not intended as specific investment advice and should not be relied on for making investment decisions.
Past Performance is no guarantee of future results. Investments are subject to risk, and any of Stadion's investment strategies may lose money.