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TSP Talk Weekly Wrap Up

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Stocks were able to rally into Friday's close to produce gains for the week after a three day pattern of falling off intraday highs after early gains. This put the S&P 500 up 4.9% for the last two weeks, its largest two week gain since February of 2015.

Wednesday's intraday sell-off was credited to traders' reaction to the Fed minutes where the plans for multiple rate hikes this year seem to still be on track. Stocks have become more sensitive to such news since the correction a couple weeks ago but the swings are becoming less severe as volatility has been falling since it spiked up earlier this month.

Bond yields hit a four year high of just under 3% in the 10-year U.S. Treasury Note mid-week. This pushed bond prices down and put some pressure on stocks. Bond yields fell off those highs as the week came to a close and bonds recovered the week's early losses.

There will be congressional testimony from the new Fed Chairman Jerome Powell next week which will most likely spark some kind of action in the markets as traders will be listening closely to any clues regarding his plans and interest rates.

The I-fund lagged the TSP funds for the week with a loss of 0.44% while the C and S-fund were both in positive territory for the week. The F-fund was flat.

Here are the weekly, monthly, and annual TSP fund returns for the week ending February 23rd:

The SPY (S&P 500 / C-fund) slowed down the pace of recovery and has been unable to produce much further off its 50-day EMA since easily passing it the previous week. The good news is the 50-day EMA successfully held the index this week from further losses. The index still has some bullish credit as it rallied to end the week near the highs. The C-fund was up 0.57% for the week to outperform the other TSP funds.

The Wilshire 4500 Completion Index (S-fund) did fall below its 50-day EMA this week a couple times but was able to recover both days it occurred. Like large cap indices, the index rallied into Friday's close. The S-fund was up 0.21% for the week.

$IEE (EAFE Index / I-fund) did not have the final rally like U.S. indices on Friday and instead was limited by the resistance of its 50-day EMA. This index does usually produce open gaps but it does have three above it at the moment and one below. The index did have some gains Friday to break above falling resistance rather than fill the open gap below. The I-fund was down 0.44% for the week.

AGG (Bonds / F-fund) fell sharply Wednesday as 10-year U.S. Treasury Note Yields rose to just under 3% where it has not been in four years. Those yields fell off those highs to end the week and bonds were able to recover the early losses. The index remained within the falling trading channel and hit its highs at the resistance line on Friday. The F-fund was down 0.01% for the week.

Good luck and thanks for reading. We will be back here next week with another TSP Wrap Up. You can read our daily market commentary at the Market Comments page. If you need more help deciding what to do with your account, perhaps one of our Premium Services can help.

Thomas A Crowley
Weekly Wrap-Ups Archive
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The legal stuff: This information is for educational purposes only! This is not advice or a recommendation. We do not give investment advice. Do not act on this data. Do not buy, sell or trade the funds mentioned herein based on this information. We may trade these funds differently than discussed above. We use additional methods and strategies to determine fund positions.

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S&P 500 (C Fund)
DWCPF (S Fund)
Dow Jones U.S. Completion Total Stock Market Index (^DWCPF)
EFA (I Fund)
iShares MSCI EAFE Index (EFA)
AGG (F Fund)
iShares Lehman Aggregate Bond (AGG)