TommyIV's TSP Talk Blog

Stocks started the week with gains and maintained those gains through turbulent action to end the weekly losing streak. The C and I-fund produces more than 1.5% in gains this week but we saw rotation back into small cap stocks leaving the S-fund up more than 4%. Tech companies continue to struggle but as did not take entire indices with them. The action was not straight up but rather choppy and ended off the highs after news of President Trump tested positive for Covid-19 sparked some selling Friday. Congress approaching a fiscal stimulus deal kept market players buying this week. The lack of progress on the deal had grown heavy on markets that expected one months ago.

The news of the President and First Lady contracting the virus had potential to pull the rug on stock prices but the selling was not impressive. Not something to expect this close to the election. Health concerns of the current president and his inability to continue his campaign plans leans in the favor of Biden. We know that markets do not like uncertainty but does this bump in the road for Trump's reelection give investors a step towards certainty? Does the illusion of an understanding of the future make investors more willing to buy no matter what that future? Think back to February sell off when there was a lot left in the air to how the virus would affect the country. Well once it was understood a bit better the market turned around; but the reality wasn't positive and we now have over 200,000 dead Americans since then. This all leaves me to wonder if investors don't necessarily care what happens, but just want to know what will happen.

Bonds lagged the TSP funds with a slight loss of 0.07%; the only loss this week for the funds.




Here are the weekly, monthly, and annual TSP fund returns for the week ending October 2:




The SPY's (S&P 500 / C-fund) gapped up to start the week and traded back above both the 20 and 50-day EMA for the week. Those moving averages came in to play Friday when the 50-day EMA held as support and the week ended even with the 20-day EMA. The gap was left open but partially filled during Friday's action. The end of the four week losing streak was a win for this chart but expect the volatility to continue. The C-fund was up 1.54% for the week.




The Dow Completion Index (S-fund) had the advantage of rotational action. Despite gains in large caps money still left the struggling tech giants like Apple and moved into small cap value names. The index gapped up for the week but held most of those gains as it closed near the week's highs. The S-fund outperformed the TSP funds with a gain of 4.06%




EFA (EAFE Index /I-fund) gapped up with the other indices but could not trade above its 20-day EMA. The moving average held every day this week as the high while the index move freely above and below its 50-day EMA. An early sell off Friday nearly closed the new gap but the index climbed from the open back to near even with the 20-day EMA. The I-fund was up 1.55% for the week.




The BND (Bonds / F-fund) continues to move sideways rather than find a direction. The wedge formation had its effects but the index just continues to remain in a flat trading range. The 20-day EMA did hold as resistance late in the week but for the last three day the index found support just under the 88.00 level. The F-fund did end the week with a slight loss of 0.07% to lag the TSP funds 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
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