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Financials, Small Caps Continue To Outperform Under Trump

Wednesday, January 4, 2017 6:25
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(Before It's News)

From Frank Holmes: As I’ve pointed out before, investors seem to be betting that, despite the uphill battle ahead, Trump can deliver on financial deregulation.

Below, the chart shows sector performance before Trump’s election compared with performance since the election. As you can see, financials jumped seven places to become the top-performing sector. What’s more, health care turned positive, suggesting investors are confident Trump and the Republican-controlled Congress can dismantle Obamacare.

S&P 500 Sectors Before and After U.S. Election
click to enlarge

Small-cap stocks, as measured by the Russell 2000 Index, are also way up on bets that Trump’s protectionist policies will benefit domestics with limited exposure to foreign markets, more so than multinational blue-chip stocks.

Investors Bet on Domestic Small Caps Following Trump's Win
click to enlarge

It might be too soon to tell, but I expect these trends to carry on into 2017.

The Financial Select Sector SPDR Fund (NYSE:XLF) fell $0.01 (-0.04%) in premarket trading Wednesday.

XLF currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #1 of 38 ETFs in the Financial Equities ETFs category.


This article is brought to you courtesy of U.S. Global Investors.

You are viewing an abbreviated republication of ETF Daily News content. You can find full ETF Daily News articles on (www.etfdailynews.com)



Source: http://etfdailynews.com/2017/01/04/financials-small-caps-continue-to-outperform-under-trump/

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