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

 

• Daily new coronavirus cases have trended down over the past two weeks, from a peak of around 940,000 at the end of April to just below 700,000 on May 14. The numbers have declined as a host of countries continued their successful vaccination efforts, including the U.S. and the U.K. However, rising coronavirus cases in India due to the emergence of a new COVID-19 variant has raised new concerns.

• The U.S. consumer price index advanced 4.2% in April year-over-year largely due to higher energy prices, raising concerns that inflation could get out of control. The headline figure is well above the Federal Reserve’s target of 2%. However, Fed officials dismissed inflation concerns as transitory due to base effects. Indeed, core CPI, which excludes energy and food prices, was up 3%.

• European core consumer price index rose 0.8% in April year-over-year, a sign that inflation is still in check in Europe. This gives the European Central Bank plenty of leeway to stimulate the economy.

• The Eurozone is officially in recession, declining for the second consecutive quarter. The Eurozone economy fell 0.6% in the March quarter, following a decline of 0.7% in the prior quarter.

• The U.S. manufacturing purchasing managers’ index declined from 64.7 to 60.7 in April, but remains in expansion territory, showing that the U.S. manufacturing industry is experiencing a strong boom, partly due to rising demand.

• The Bank of England has maintained interest rates at a record low of 0.1% and the monetary policy committee voted to keep intact the 895-billion-pound quantitative easing program, although one member dissented, arguing he wanted a slightly smaller stimulus program. The Bank of England forecasted the U.K. economy will grow by 7.25% this year, upgrading its estimates from 5% previously.

• The U.S. economy added 266,000 jobs in April, missing analyst estimates of 990,000, and down from 770,000 in March. Meanwhile, the unemployment rate rose to 6.1% from 6% previously. On the bright side, average hourly earnings surged by 0.7%, beating expectations of flat growth. In March, earnings declined by 0.1%.

• U.S. retail sales growth was flat in April, compared with a 10.7% advance in the prior month. Core retail sales, which excludes automobiles, was down 0.8% versus 9% growth in the prior month.

• We provide this report on a fortnightly basis. To stay up to date with mutual fund market events, come back to our news page here.

• U.S. equities have all fallen this week, as investors took some money off the table.

• Vanguard 500 Index Fund Admiral Shares (VFIAX) has declined the least from the pack, down 0.10%.

• Meanwhile Vanguard Small-Cap Index Fund Institutional Shares (VSCIX) is the worst performer, with a drop of 1.3%.

• Fixed income assets showed mixed results.

• Vanguard Short-Term Inflation-Protected Securities Index Fund Admiral Shares (VTAPX) is up 0.69%, as investors sought protection from inflation.

• At the other end of the spectrum is Vanguard Long-Term Investment-Grade Fund Investor Shares (VWESX), with a fall of 0.65%.

• Sectors have also posted mixed performance.

• Vanguard Materials Index Fund Admiral Shares (VMIAX) is up 6.10% as high demand for many manufacturing products has driven up commodity prices.

• Meanwhile T. Rowe Price Communications & Technology Fund Investor Class (PRMTX) is the poorest performer, with a fall of 5.16%.

• Foreign equities were rather mixed.

• Vanguard European Stock Index Fund Admiral Shares (VEUSX) is up 2.8%, as investors moved some of the money on the continent, where shares are believed to be undervalued.

• Fidelity® China Region Fund (FHKCH) is down nearly 6%, representing the worst performance from the pack.

• Alternative assets were mixed.

• PIMCO CommodityRealReturn Strategy Fund Institutional Class (PCRIX) rose 2.8%, the best performer from the pack for the second consecutive week.

• Vanguard Real Estate Index Fund Admiral Shares (VGSLX ) is the weakest performer, with a decline of 2%.

Inflation-protected bonds, U.S. materials equities, and European stocks have been the best performers this week, partly due to inflation fears in the U.S. and rising commodity prices. Meanwhile, Chinese shares, telecommunications equities, and investment-grade equities have been among the worst performers.

Be sure to sign up for your free newsletter here to receive the most relevant updates.

Fund returns data are for the two-week period between April 30, 2021, to May 14, 2021.