MutualFunds.com provides a snapshot of the performance of some key mutual funds which tries to accurately capture the investor interest in specific areas of the financial markets. The report is aimed at providing a quick overview of the sectors, regions, and asset classes that moved in a meaningful manner during the last two weeks.

 

• COVID-19 vaccination efforts are moving at a brisk pace in the U.S. and the UK but are stumbling in Continental Europe partly due to lack of enough jabs. The strong rollout in the U.S. and the UK holds the promise that these countries will return to normal soon, with the UK already publishing a blueprint for the full reopening of the economy by mid-summer. A further encouraging sign is that the number of coronavirus cases has continued to trend down worldwide.

• The U.S. Senate passed a fresh $1.9 trillion coronavirus aid package and the bill is expected to hit President Joe Biden’s desk before March 14 for final approval. As part of the program, most U.S. citizens will get $1,400 directly deposited in their bank accounts and $300 per week as jobless benefits, among others.

• European flash manufacturing purchasing managers’ gauge (PMI) rose to a three-year high of 57.7 in March, up from 54.8 in February. Meanwhile, services PMI continued to remain in negative territory as lockdown measures across Europe dented purchasing managers’ sentiment. Services PMI came in at 44.7, down from 45.4 in February.

• U.S. manufacturing PMI was also in very strong standing. ISM’s manufacturing PMI surged to a two-year high of 60.8 from 58.7 in February.

• European inflation seems to be heading up, albeit still well below the European Central Bank’s target of 2%. The February consumer price index was up 0.9% compared to the same period last year, same as in January, but up from negative levels in the last five months of 2020. Core CPI, which excludes volatile food, energy, and tobacco, was up 1.1%.

• OPEC and Russia decided against raising oil output levels substantially, despite a rally in crude prices. The cartel and Russia agreed to keep the powder dry given the uncertainty in oil markets stemming from the coronavirus pandemic, which weakened demand for air and car travel fuel.

• The U.S. economy added 379,000 new jobs in February, surprising economists who on average expected a tame reading of 195,000. The number is twice as high as in January and shows the U.S. economy is recovering from one of the worst economic shocks in recent memory. The unemployment rate fell from 6.3% to 6.2%, while average hourly earnings advanced 0.2%.

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• After a prolonged rally, U.S. equities have finally given up some of the gains over the past two weeks.

• Vanguard 500 Index Fund (VFIAX) was the best performer from the pack, posting a decline of just 1.59%.

• Vanguard Mid-Cap Index Fund (VMCIX), which was the best performer last time, is now at the bottom of the performance list with a fall of 3.63%.

• Fixed income assets were all down, with one exception.

• Vanguard Long-Term Investment-Grade Fund (VWESX) was again the worst performer these past two weeks, shedding 3.35%.

• Vanguard Short-Term Inflation-Protected Securities Index Fund (VTAPX) was the only riser from the pack with an advance of 0.31%.

• Sectors were rather mixed, but most posted losses.

• T. Rowe Price Communications & Technology Fund (PRMTX) was the worst performer from the pack, posting a decline of 7.89%. Other notable losers were the technology sector and consumer discretionary.

• At the other end of the spectrum, Vanguard Energy Fund (VGENX) gained 4.8%, largely thanks to a continued rally in oil prices.

• All foreign equities were down.

• Fidelity Latin America Fund (FLATX) and Fidelity China Region Fund (FHKCX) were both slammed these past two weeks, losing nearly 9% of their value and becoming the worst performers from the pack.

• Meanwhile, Matthews India Fund (MINDX) posted the best performance, with a slight loss of 0.07%.

• Alternative assets’ performance was mixed.

• PIMCO CommodityRealReturn Strategy Fund (PCRIX) was the only gainer from the pack, up 0.92%.

• Meanwhile PIMCO Emerging Markets Currency and Short-Term Investments Fund (PLMIX) was the worst performer with a decline of 2.56%.

U.S. equities, technology, and telecommunication stocks have led market declines these past two weeks. Latin American and Chinese shares have also suffered along with investment-grade bonds. Meanwhile, energy shares, commodities, and inflation-protected securities were among the few risers.

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Fund returns data are for the two-week period between February 9, 2021, to March 5, 2021.