1.U.S. Stocks Vs. International…Big Spreads.
Since the 2009 bear-market low, the SPDR S&P 500 exchange-traded fund (ticker: SPY) has shimmied up 244%, outgunning the 96% gain in the iShares MSCI All Country Ex-U.S. ETF (ACWX), and 93% for the iShares MSCI Emerging Markets ETF (EEM).
5 Year Chart…S&P +66% vs. EEM -7%
5 Year Chart S&P +66% vs. International Developed +13%
1. The Nasdaq Composite is now averaging around 22 times forward earnings —21% above its five-year average.
2015-2016 is Sideways..Rally then Trump Bump
1.Water ETF Breaking to New Highs….The World Needs More Fresh Water.
PHO Water ETF…New Highs 50day thru 200day to Upside.
How to Invest in Water: 5 Picks
Analysts and money managers see a wave of water-related investments ahead. But there isn’t a single dominant company to bet on.
Today, for instance, the PowerShares Water ETF trades at 23.1 times trailing 12 month earnings—a tad richer than its median over the past decade, but well shy of the peak of 28.1 times. Compare this with, say, the Industrial Select Sector SPDR ETF (XLI), which is already straining at itsdecade-peak of 20.7 times trailing earnings.
1.Will Corporations Switch from Buybacks to Capital Spending in 2017?
Buyback ETF vs. S&P…New Trend?? Buybacks added fuel to this bull run.
Buybacks 4th qt. 2016 half the previous qt. and lowest since 2014
For years, American companies’ loved nothing more than using their cash to buy their own stock. But tastes may be changing.
But the data also suggest a shift is underway. In the fourth quarter, nonfinancial companies bought back a net $323 billion in equities, at a seasonally adjusted annual rate, half as much as in the previous quarter and the lowest amount since the second quarter of 2014.
And unlike the third quarter, companies’ capital spending surpassed their cash flows, which is a return to normal. Companies usually borrow to spend, betting the payoff from the investments more than pay off the debt.