This past week, the ishares S&P 500 (NYSE:IVV tested resistance at the 2120-25 level, close to the all-time highs for the market, after a remarkable rebound from its crushing meltdown in January. At least for now it has failed. Look for a possible short-term pull back here, probably down to the 50-day MA average at the 2075 level. The S&P 500 is up 3.65% for the year.
The Guggenheim Invest S&P 500 Equal Weight (NYSE:RSP) is set up so that every stock in the index has the same weight, thereby eliminating the market-weighting growth bias. As a result, the index tilts more towards mid-cap and value stocks, which accounts for much of the out-performance versus the cap-weighted index in the last decade. So far this year, the index is up 5.72% year-to-date, slightly outperforming the cap-weighted index and in line with general market trends.
One of the themes of the past decade has been growth-oriented, smaller cap stocks outperforming high quality, blue chip stocks. That trend is once again valid for 2016, after the iShares Russell 2000 (NYSE:IWM) underperformed by a wide margin in 2015. IWM is on par with the large cap index and is up 3.48% YTD.
The S&P 500 versus the Russell 2000 Index, Weekly Chart. After breaking out towards the end of 2015 and into 2016, the large cap index has come back down to Earth and pulled back to the 50-week MA.
Looks like the weakening Chinese economy managed to deflate the iShares MSCI EAFE (NYSE:EFA). The index is down 2.67% since the beginning of the year, significantly worse than its US counterpart, continuing the trend that began in the second half of last year. In the last week of trading action, it seems to have broken down as well, breaking under the 50 and 200 day moving averages.
The iShares MSCI EAFE Small-Cap (NYSE:SCZ) has performed slightly better than the large cap index this year (-7.95%), after impressively holding onto a 9% gain last year. Unlike the US markets, international small caps are outperforming their large cap index over the last 12 months.
EAFE Large Cap Index vs EAFE Small Cap Index, Weekly View. It’s been a steady small cap outperformance since October of last year.
