With Fed Chair Janet Yellen delivering the Semi-Annual Monetary Policy Report to Congress today, we thought it was apropos to take a look at the performance of various asset classes since the Fed hiked rates 56 days ago back on December 16th.
Below is a table showing recent asset class performance using ETFs traded on U.S. exchanges. U.S. equity related ETFs are shown on the left side of the table, while the right side includes country and other international equity ETFs, commodities ETFs, and fixed income ETFs.
As you can see, it has been UGLY for the equity asset class since since the Fed hiked. The S&P 500 tracking SPY ETF is down nearly 11%, while the Nasdaq 100 (QQQ) is down 15.5%. Smallcaps (IWM) are down even more at -16.3%.
In terms of sectors, Financials (XLF) — which investors were hoping would perform better with higher lending rates — are down the most at -16.6%. Only Utilities (XLU) have done well post hike, as investors have loaded up on defensive plays that offer attractive dividend yields.
Outside of the U.S., Italy (EWI) is down the most at 23.3% post hike, while most other countries are down between 10% and 15%.
While equities have gotten slaughtered since the Fed hiked on December 16th, gold, silver, and Treasuries have soared.
Yes, the market has responded to Yellen and Co.’s recent decision to hike rates with quite a negative force.