Displaying items by tag: US
US Treasury Selloff Halts
(New York)
Bond gurus across Wall Street were calling it the beginning of the bond bear market. Treasuries had dropped significantly, with yields holding over 2.5%. However, the selloff halted yesterday as reports of Chinese plans to stop buying Treasuries were reported as possibly false. A commentator from BNY Mellon explains the situation best, saying “Whether the news of Chinese withdrawal was fake or not, the Treasury market is likely to continue to feel a little fragile, but the fact remains that the hunt for yield goes on and with no real signs of inflation yet and improving growth, there are still no real sellers out there”.
FINSUM: We think that is a very eloquent summary of the current situation. We do not think it is time to be bearish yet.
Americans are Sitting Out the Stock Rally
(New York)
The stock market just finished a sensational year, capping what seems a one-in-a-lifetime nine-year run. However, there is something very surprising about this rally that is different than those in the past—more and more Americans are sitting it out because of fear. Since the start of 2012, nearly a trillion Dollars has been pulled from retail equity mutual funds (some went back in as ETFs). The market rose 116% over the same period. In the last three years, US stock funds (ETFs included) have seen net outflows each year.
FINSUM: The Financial Crisis left deep scars for investors all across the country, and the traumatic effects of it can be seen in the data.
US Investors are Avoiding American Stock Funds
(New York)
Anyone on the lookout for signs of a correction might want to pay attention to this. New data shows that US investors are avoiding US stock funds. Of the $4.1 bn poured into mutual funds and ETFs in the week ending December 27th, around 70% of the money flowed overseas. The trend is nothing new though, as US stock funds saw their third straight year of net outflows despite the market rising strongly. Taxable bond funds and international stock funds have seen 56 straight weeks of inflows.
FINSUM: We don’t think this is a warning sign of anything other than good times to come. US investors tend to put more money overseas when they are bullish, so this is not a negative sign.