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TSP Talk Weekly Wrap Up

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Money moved into stocks early this week after a temporary trade truce was made between the U.S. and China over the weekend; but an outperforming jobs report proved to be too much good news for investors, at least early on Friday. New highs were made for major large cap indices Wednesday before the holiday. The trade truce had lifted the fears of buyers while sellers left a day early for their fourth of July celebrations; but they were back to work first thing Friday morning.

It was another case of good new is bad news when the Federal Reserve is involved. The Fed suggested a possible rate cut last month and since then investors feel they deserve monetary stimulus despite reaching all time highs. So when the jobs report came out Friday with more good news about the strength of the economy it wasn't logically celebrated but rather stocks sold off alongside the likelihood of an upcoming rate cut. Stocks did regain some of the early losses and with the action of the rest of the week both the C and S-fund gained more than 1% for the week. But the reaction by investors goes to show how backwards things are becoming; or how backwards they've been.

The beginning of July came with a head scratcher but the bulls still have the momentum and second quarter earnings reports will be coming in this month to give investors something to react to.

The C-fund outperformed the TSP funds with a gain of 1.69%. Bonds were down this week with the damage coming following the jobs report numbers. The F-fund was down 0.14% to be the only TSP fund in negative territory for the week.




Here are the weekly, monthly, and annual TSP fund returns for the week ending July 5th:




The SPY (S&P 500 / C-fund) gapped up to start the week and gapped up again Wednesday before the 4th. The early sell-off Friday brought stocks down to fill the closest open gap before the early losses were bought back. A couple intersecting support lines marked the lows of Friday so for now the gaps below will be left open. We've seen a turn in momentum with the turn of a new month the previous three months. This time June's momentum carried into July to keep the S&P 500 in record territory. The C-fund as up 1.69% for the first week of July.




The Dow Completion Index (S-fund) rose this week but was not trading at its highs but rather approaching them. The index had a steep jump into July but was slowed by rising resistance had did not get a chance to test the highs of May. The index has support below from both trend lines and moving averages so if there is no surprises its likely to see the index test the highs just to see how it will react. The S-fund was up 1.34% for the week.




EFA (EAFE Index /I-fund) was up early this week with the rest of stocks and gapped down Friday after reaching new highs. The index fell below the rising support of June Friday. The I-fund was up 0.51% for the week.




AGG (Bonds / F-fund) climbed steadily for the week and peaked at rising resistance Wednesday. The release of the jobs numbers kick yields higher bonds fell putting the index below rising support. The 20-day EMA was not tested before bonds rose a bit to close out the week. The F-fund fell 0.14% 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
www.tsptalk.com
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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SPY (C Fund) (delayed)

(Stockcharts.com Real-time)
DWCPF (S Fund) (delayed)

(Stockcharts.com Real-time)
EFA (I Fund) (delayed)

(Stockcharts.com Real-time)
AGG (F Fund) (delayed)

(Stockcharts.com Real-time)