Weekly Average Momentum Index (AMI) rankings of HSA, SSPP, RSP, SELECT, ETF, iETF, sETF have been posted at http://sites.google.com/site/ycprankings
Trading signal occurs in HSA model portfolio: Sell IUTIX, Buy NSVAX.
Investors' mind are still focused on the festivity of the holidays and not on the tradings in the last trading week of the year. Major indexes ended the week about where they were in the beginning of the week. SP 500 index closed this week at 1257 down 0.61%, the Dow Jones Industrial Average lost 0.62%, and the Nasdaq composite index decreased 0.52%.
After holding Columbia treasury index fund, IUTIX, for 6 months, trading signals occurs in our HSA model portfolio as more stock funds gaining momentum and push the rank of IUTIX out of the top five funds. The holding has been replaced with a more aggressive small cap value fund, NSVAX.
S&P 500 started this year at 1257 and ended at 1257 with no gain for the year. In the beginning of the year, economy recovery was gaining traction, more new jobs were created and the index went up for January, February, March and reached the height of 1363 on April 29. At that time it appeared we were going to have another blockbuster year for stock markets. But suddenly the economy landscape changed: first, Japan hit by tsunami which caused nuclear scare and auto parts shortage, and quenched the manufacturing activity. Following the natural disaster was the human political gridlock at Washington D.C., where politician stuck to their party ideology and failed to reach agreement on raising government debt ceiling to keep it running. The action shattered investors' confidence and cost the triple A standing of the US government debt. Not to be outdone by United States, the European national debt crisis came to limelight and became a bigger problem, insolvency concern spread from Greece to Span, Ireland, and even Italy. With these speed bumps, manufacturing slowed, consumer tighten and company stopped hiring. Sensing the weakness in the economy, the S&P 500 index stopped its climb and headed south. It plummeted 220 points in six weeks from July 11 to August 22, and reached the low of the year on October 3 at 1099, 19% below the high of 1363. US economy has since then performed better than the rest of the world. Its economy growth is still slow but steady, jobless claim were down and consumers seemed to come back to the market place, and S&P 500 index has climbed to end at where it was at the start of the year.
Weekly chart shows that S&P 500 index is still above its trend line and gaining momentum. Hopefully it will stay there and slowly change the direction of the trend line from downward slope to a positive one next year. As for the global regions, I think they will still under perform US markets at least for the first half of next year due to the lingering of European debt concern. Happy New Year and Happy Trading!
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