Overview
Let’s start with an overview of performance in the financial and commodities markets year to date.
Note: Click on the charts below to view full-size versions.
US Dollar Index
After rising 12% in 2014, the US Dollar Index continued to rise strongly in the first quarter and then consolidated in the 2nd quarter, now up 5.8% for the year.
Equities
While the S&P was essentially flat for the first half of the year, small-caps and mid-caps continued to perform.
SCHA, SCHM, SCHX, PKW
Morningstar Sectors
Real estate was the strongest sector globally.
IBB – Biotech
Obamacare ETFs: XLV(Health Care Select), IHE (US Pharmaceuticals), IHF (Providers), IBB (Biotech), IHI (Medical Devices)
Motif Investing
Curing cancer and preventing hacking topped the 1 year returns at Motif Investing.
ITB
US Home Construction outperformed the S&P for the first half…
IYR
…while US Real Estate sunk, in part over concerns regarding rising interest rates.
OIL
Oil was flat – no recovery in the oil patch yet. Solar was the energy group that did well in the first half.
RSX (Russia), OIL
Despite the US continuing to play the “oil card,” the Russian markets recovered some of last years losses.
DAX (Germany)
FXI (China Large Caps)
Chinese equities have also enjoyed a very strong 2015. May and June gave up almost half of the gains so far this year.
ASHR
PIN (India)
India also had a weak second quarter and ended up slightly for the year to date.
EEM (Emerging Markets)
EFA (International Developed)
Internationally, the developed markets outperformed the emerging markets.
WAFMX (Frontier Markets)
Fixed Income
The turn in the fixed income market is upon us. Add dropping prices to low yields, and you have an unattractive combination.
AGG (Bond Aggregate), IEF (5-7yr Treasury), TLT (20yr+ Treasury)
Commodities
GLD (Gold), SLV (Silver)
Precious metals continue to underperform and the charts look weak despite continuing efforts to lock up physical bullion inventory around the globe.
CRB (Commodities Index)
Commodities = up and down, up and down, with no change for the year.
A Look “Down Under”
For many years, Australian equities enjoyed the demand for commodities created by growth in Asia, especially China.
EWA (Australia), ENZL (New Zealand) vs. EFA (Developed International) & S&P – 10 Years
EWA (Australia), ENZL(New Zealand) vs. EFA(Developed International) & S&P – 5 Years
Coming out of the 2008-9 financial crisis both Australia and New Zealand were trading up with other markets, with Australia out performing the S&P until the US market began to rise ahead of global markets in 2013.
EWA (Australia), ENZL (New Zealand) vs. EFA (Developed International) & S&P – YTD
As the markets have dropped in the second quarter, Australia and New Zealand have dropped with them. New Zealand, in particular, is underperforming most markets.
