The Trade Report

January updates to our ETF portfolios

Good morning,

A quick note on yesterday’s action before we get into our ETF trades.

The bulls swung and missed again yesterday. Just like several days last week, futures were surging in the morning and stocks opened strong. However, those gains faded throughout the day and NYSE breadth ended negative, along with the equally-weighted S&P 500.

Bullish action from semiconductors is definitely a positive but with a “buy everything” day still eluding us, we’re going to continue to tread carefully and keep moves minimal.

December saw stocks and bond prices fall and our models underperformed slightly thanks to risk-on positioning and a sharp decline in small caps and cyclicals.

However, it wasn’t defensives that outperformed but the top growth sectors, and the relative trends continue not to support a rotation into the classic defensive sectors.