Major Asset Trends: Divergence of U.S. Stocks and Emerging Market Stocks Continues

MyPlanIQ submits:Last week, all major global stock markets registered loss: Frontier stocks (FRN) lost most -- -2.6%, followed by Emerging market stocks (VWO) -- -1.89%, and U.S. stock markets (VTI) -- -1.73%. REITs also showed their weakness.

MyPlanIQ submits:The first quarter of 2011 ended with several 'best' gains for the two most popular stock indices: the S&P 500 (SPY) rose 5.4%, the biggest first-quarter rally for the index since 1998. The same can be said for the Dow Jones Industrial Index (DIA): it rose 6.4%.

MyPlanIQ submits:Last week's furious recovery of risk asset prices clearly indicated that investors are now experiencing less risk aversion.

MyPlanIQ submits:Risk assets' correction in last week was across the board: virtually all risk assets, other than US REITs (VNQ), turned up negative.

MyPlanIQ submits:Going into 2011, investors have shown a consistently increasing risk appetite among major assets. The following trend table (for more details, refer here) illustrates this:

MyPlanIQ submits:Dividend ETFs performed well last week: leading the pack are the emerging market stocks (EEM) and emerging market dividend stocks (DEM), gaining 2.38% and 1.9% respectively. International REITs also did well, gaining 2.04%.

MyPlanIQ submits:Last week saw many risk assets dropped. The following table shows recent performance for major asset classes.

MyPlanIQ submits:Last week, we finally saw risky assets had some meaningful correction: Frontier market stocks (FRN) led the decline, dropping more than 5%, while emerging market stocks (VWO, EEM) followed, dropping 2.44%.