The 1-Minute Market Report - September 3, 2019

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Includes: BAPR, BAUG, BIBL, BJUN, CHGX, CRF, DDM, DIA, DMRL, DOG, DUSA, DXD, EDOW, EEH, EPS, EQL, EQWL, ESGL, FEX, FWDD, GSEW, HUSV, IVV, IWL, IWM, JHML, JKD, OMFS, OTPIX, PAUG, PMOM, PPLC, PSQ, QID, QLD, QQEW, QQQ, QQQE, QQXT, RSP, RVRS, RWM, RYARX, RYRSX, SCAP, SCHX, SDOW, SDS, SFLA, SFY, SH, SMLL, SPDN, SPLX, SPSM, SPUU, SPXE, SPXL, SPXN, SPXS, SPXT, SPXU, SPXV, SPY, SQQQ, SRTY, SSO, SYE, TNA, TQQQ, TRND, TWM, TZA, UAUG, UDOW, UDPIX, UPRO, URTY, USA, USMC, UWM, VFINX, VOO, VTWO, VV, ZF
by: Erik Conley
Summary

The latest round in the stock market went to the bears, but the fight isn't over.

The economic numbers are coming in mixed for the U.S. but decidedly weak for most other countries.

There is now $17 trillion of negative-yielding government debt in the world.

market direction

What happened last week.

What we're watching for next week.

The Stock Market

This market has turned into a 15-round heavyweight fight between bulls and bears, or optimists and pessimists if you like. The latest round went to the bears, but the fight isn't over. Down by 1.8% isn't very noteworthy, given that the normal monthly range for the S&P 500 is up or down 2.13%.

The Economy

The economic numbers are coming in mixed for the U.S. but decidedly weak for most other countries. Few economists will deny that the global economy is slowing. But U.S. economists, in general, think that we can escape the grip of a global recession. We'll see about that.

We now have $17 trillion of negative-yielding government debt in the world. This is a tax on savers, especially pension funds. How long can this go on? The bogeyman of deflation is in the air.

Geopolitics

There isn't much in the way of positive news to report this week. The U.S.-China trade war continues to escalate; Sabre-rattling between U.S. and Iran is intensifying; North Korea is still test-launching missiles and working on their nuclear warhead program; Afghanistan is devolving into a Taliban killing field; and Prime Minister Boris Johnson appears to be mimicking Trump by painting the British Parliament as the enemy of the people.

Chart 1. Winning Asset Classes Year to Date

This table is a snapshot of the YTD performance of asset classes based on widely held ETFs. There is now $5.6 trillion parked in ETFs, which gives us a good idea of which asset classes are winning and which are not. Here are the best-performing asset classes YTD.

Chart 2. Losing Asset classes YTD

Here are the worst-performing asset classes YTD.

Chart 3. Summary of Winning ETFs

This table shows the number of asset class ETFs that made it to the Top 25 list.

Chart 4. Summary of Losing ETFs

This table shows the number of asset class ETFs that landed at the bottom of the performance rankings.

Final Thoughts

The bears are circling, but the bulls are not ready to give up the fight. For next week, I'm watching for movement on the Trade War front, the worsening of the Treasury yield curve, and Friday's employment report.

Editor's Note: The summary bullets for this article were chosen by Seeking Alpha editors.