Despite Recent Decline, Stocks Retain Top Spot for Returns
James Picerno | Jun 26, 2023 14:19
The Global Market Index fell 1.7% last week (through June 23), marking the first decline for this multi-asset-class benchmark since the final week of May.
Equities in Europe and Asia are moderately lower in today’s trading following the failed coup in Russia over the weekend. Energy prices are higher after the turmoil that briefly threatened President Putin.
“The immediate challenge to the Putin regime appears to have receded,” write analysts at RBC Capital Markets in a June 25 note. “However, the risk of further civil unrest in Russia now must be factored into our oil analysis for the back half of the year.”
US bonds were last week's winners for the major asset classes if only just barely, based on a set of ETF proxies. Inflation-indexed US Treasuries led the way via iShares TIPS Bond ETF (NYSE:TIP), which ticked up 0.1%. Although the fund has posted slight gains in the past two weeks, TIP continues to trade in a narrow range that’s prevailed in recent months.
US real estate investment trusts posted last week’s biggest decline. Vanguard Real Estate Index Fund ETF Shares (NYSE:VNQ) lost a hefty 4.5%. The selling suggests that the bear market for VNQ is set to continue.
The Global Market Index (GMI.F) lost ground last week, slipping 1.7%, the first setback in four weeks. This unmanaged benchmark holds all the major asset classes (except cash) in market-value weights via ETFs and represents a competitive measure for multi-asset-class portfolio strategies.
For the one-year trend, Vanguard Total Stock Market Index Fund ETF Shares (NYSE:VTI) continue to hold the lead. Vanguard Total Stock Market Index Fund (VTI) is up nearly 17% vs. the year-ago level, based on total return. WisdomTree Continuous Commodity Index Fund (NYSE:GCC) is the weakest performer, posting a near 14% loss.
Get The App
Most of the major asset classes are still posting relatively deep drawdowns. The deepest peak-to-trough decline at the moment: foreign real estate shares (VNQI) are reporting a near-30% drawdown as of Friday’s close.
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.