It has now been one full month since Donald J. Trump was inaugurated as President, and you may recall that the general consensus after the big post-election rally was that investors should “buy the Election and sell the Inauguration.”  Even though the ‘buy’ part of the strategy was never mentioned until early January – well after the market rallied in November – the consensus trade was that all of the gains pre-Inauguration were being borrowed from the future and that investors would sell the news after Trump was sworn in.  It has only been a month, but so far the strategy hasn’t quite panned out.  Since Inauguration Day, the S&P 500 is up 3.3%, while the average performance of the 500 stocks in the index is even better at +3.6%.

In the tables below, we provide a brief summary of the S&P 500’s biggest winners and losers during the first full month under President Trump.  The first table below lists the 25 biggest winners over the last month.  Leading the way higher is Arconic (ARNC), which thanks to an activist investor, is up over 40%.  Behind ARNC, Seagate Technology (STX) is the only other stock up more than 20%.  Other notable names on the list include Apple (AAPL) and Cisco (CSCO).  In terms of sector representation, it was surprising to see relatively few stocks from the Financials (3) and Industrials (4) sectors as they have been considered to be among the biggest winners under a President Trump.  On the flipside, the sectors with the greatest representation are Technology and Health Care, each with six stocks.  Both of these sectors did poorly on a relative basis to close out 2016, but investors have started coming around to them regardless of the President’s not-so-positive-relationship with the sectors.

To the downside, 117 stocks in the S&P 500 are down since the Inauguration, and below we list the 25 worst performers.  Under Armour (UAA) has been the worst stock by far, losing close to a quarter of its value.  Behind UAA, eight other stocks are down 10%, including other consumer names like Mattel (MAT), Ralph Lauren (RL), and H&R Block (HRB).  In fact, Consumer Discretionary stocks have been especially hard hit under President Trump with eight of the worst 25 performers.  Likewise, even though he has promised to decrease regulation and ease drilling restrictions, eight stocks from the Energy sector also made the list of 25 biggest losers.  Perhaps there will be just too much oil coming out of the ground.  One sector conspicuously absent from the list of biggest losers is Financials.  While they may not be ripping under President Trump, Financials also haven’t been under pressure by any stretch.

Below is a look at current S&P 500 sector weightings using GICS standards.  As shown, Technology’s weighting now stands at 21.53%, making it the biggest sector by a wide margin.  The Financial sector is the second largest with a weighting of 14.8%.  Remember, though, that the REITs were recently given their own sector, which lowered the weighting of the Financial sector by over two-and-a-half percentage points.  If the Financial sector still contained the REITs, its weighting would be 17.6%.

Below is a look at the change in sector weightings since Election day last November 8th.  As shown, the Financial sector has seen the biggest jump by far at 1.4 percentage points.  The only other sector that has seen a meaningful jump is Industrials (+0.20 percentage points).  On the downside, we’ve seen Consumer Staples, Energy, Health Care, Utilities, Real Estate, Telecom, and Consumer Discretionary all lose share since election day.

If we look at changes in sector weightings so far in 2017, things look quite different versus the change since Election day.  Since the start of 2017, the Technology sector has seen the biggest jump in its weighting at 0.76 percentage points.  The Consumer Discretionary has seen the next biggest jump at 0.17 percentage points.

While the Financial sector has seen the biggest jump in weighting since Election day, it has actually lost share since the start of the year.  So all of its post-Trump gains in share came in 2016.

Welcome to Bespoke Brunch Reads — a linkfest of the favorite things we read over the past week.  The links are mostly market related, but there are some other interesting subjects covered as well.  We hope you enjoy the food for thought as a supplement to the research we provide you during the week.

Baby Boomers

With $15 Left in the Bank, a Baby Boomer Makes Peace With Less by Timothy W. Martin (WSJ)

The aging Boomer cohort is no stranger to debt, a financial strategy which leads many of those later in life to cut it close during times of economic stress. [Link; paywall]

Boomers stuck in a circular unfunded liability they will never break out of… by Deux Et Vingt (Macro Ramblings From the ‘Burbs)

Are low interest rates and high stock prices all the same trade, driven by a massive cohort that is desperately trying to save enough for long retirements? [Link]

Food

Hot, Sticky, & Sweet by Keaton Lamle (Bitter Southerner)

The culture and iconic status of fried dough with a sweet topping in across the South. [Link]

International Relations

How Serious Is the Threat to Global Financial Stability From a Border-Adjustment Tax? by Brad Setser (Council on Foreign Relations)

Regardless of its impact on the domestic economy (which is hotly debated as Senators start to line up against the House’s preferred tax reform proposal), a BAT could have significant repercussions across the global economy purely thanks to its financial markets effects. [Link]

About Face: A History of America’s Curious Relationship With China, From Nixon to Clinton by James H. Mann (Foreign Affairs)

Only Nixon could go to China, and this week marked the anniversary of that remarkable pivot in US foreign policy during the Cold War. [Link]

Strange News

Blackstone CEO throws himself ‘the party of the century’ by Emily Smith (Page Six)

Camels, Mongolian greeters (???), a custom-built temple, Gwen Stefani, and the celebration of Stephen Schwarzman’s birthday party in Florida. [Link]

Howard Stern Sued for Broadcasting Woman’s Conversation With IRS by Eriq Gardner (The Hollywood Reporter)

Does broadcasting 45 minutes of an IRS agent’s call with a taxpayer make for good radio? We doubt it but that didn’t stop Howard Stern from airing it in 2015 and he’s now getting sued. [Link; auto-playing video]

Real Estate: The Good, The Bad, and The Ugly

How Resilient Is the U.S. Housing Market Now? by Andreas Fuster, Eilidh Geddes, Benedict Guttman-Kenney, and Andrew Haughwout (NY Fed Liberty Street Economics)

A comprehensive review of the fundamentals of the housing sector, from LTVs to delinquency at both a national and regional level. [Link]

Mortgage Rates Monday, Feb. 13: Higher; Lower-Credit Borrowers Discouraged by Deborah Kearns (Nerdwallet)

Much of the post-crisis improvement in mortgage applicant FICO scores is due to low-score borrowers not bothering to apply for loans in the first place. [Link]

Are gains in black homeownership history? by Laurie Goodman, Jun Zhu, and Rolf Pendall (Urban Institute)

After years of improvement in the lower rate of homeownership amongst blacks, gains started to reverse in the early 1990s and have dramatically underperformed other cohorts. [Link]

Appconomy

Dopamine Labs slings tools to boost and reduce app addiction by Jonathan Shieber (TechCrunch)

A new start up aims to use neuroscience to offer other app developers the key to hooking users, while trying to prevent PR disaster by also offering tools to reduce appdiction. [Link]

Defaults Slash Returns for Online Loan Investors by Peter Rudegeair (WSJ)

Rising defaults and interest rate increases are dragging down performance for the investment funds that feed capital into many online platform lending players. [Link; paywall]

Now Facebook wants to be your weather app by Michael Grothus (Fast Company)

As if we didn’t spend enough time collectively on Facebook already… [Link]

Elon Musk Is Really Boring by Max Chafkin (Bloomberg)

A traffic jam led Elon Musk to just start digging, thus reinventing an entirely not new form of transportation and earning himself a Blooomberg Businessweek cover. [Link]

Investing

Rob Arnott Says You’ll Be Sorry for Ignoring Smart Beta Warnings by Dani Burger (Bloomberg)

More sturm und drang about the risks of smart beta, which can lead to concentrations and correlation risk for investors. [Link]

Moments Of Truth

Oil Producers Promised Output Cuts. Here’s the Reality. by Brian Wingfield, Samuel Dodge and Hayley Warren (Bloomberg)

Some nice charts on the share of proposed cuts that have actually been met by both OPEC and non-OPEC nations following last fall’s deal. [Link]

It’s a Moment of Truth for U.S. Companies by Oliver Renick (Bloomberg)

With sentiment indices surging, is now the time corporate capex will finally start to accelerate? [Link; auto-playing video]

Congrats!

U.S. flight cancellations, baggage problems fall to historic lows by David Shepardson (Reuters)

In a rare bit of good news, airlines cancelled 1.17% of flights (a new record) and mishandled only 2.7 pieces of baggage per 1000 passengers. [Link]

Politics

The Rise and Fall of a K Street Renegade by Brody Mullins (WSJ)

The massive lobbying success, free-wheeling spending, and tragic downfall of a man that re-wrote the rules for corporations’ efforts to grab Washington’s attention. [Link; registration required]

Le Pen is on course to be France’s next president, fund manager says from AI analysis by Everett Rosenfeld and Nyshka Chandran (CNBC)

Le Pen’s poll numbers haven’t moved much but betting markets and some sort of “AI” (likely code for a series of linear regressions) are moving much more in her favor. [Link; auto-playing video]

GOP May Cap Insurance Tax Break as ACA Repeal Bill Nears by Anna Edney, Billy House and Arit John (Bloomberg)

One of the most interesting possible policy options we’ve seen so far around ACA repeal is the concept of corporate deductions on health care benefits, a source of significant distortion in US health care markets. [Link; auto-playing video]

Stephen Miller Is a ‘True Believer’ Behind Core Trump Policies by Glenn Thrush and Jennifer Steinhauer (NYT)

A profile of one of Trump’s closest – and most extreme – advisors. [Link; soft paywall]

Women

Q&A: Melinda Gates on the World’s Missing Data About Women by Megan Murphy (Bloomberg)

An interview with one of the world’s biggest philanthropists where she focusses on the challenges of improving outcomes for women when there is so little data to assess the lay of the land. Also an interesting look at the Bill and Melinda Gates Foundation more broadly. [Link; auto-playing video]

Have a great Sunday!