Week In Funds: U.S. Stock Funds Extend Gains

U.S. diversified stock funds notched their third straight week of gains, rising 0.62% on average in the week ended May 21. It was also the seventh up week in the past eight.

The market traded in a tight range all week, mostly on low volume, as the end of the first-quarter earnings season neared. The S&P 500 hit a couple of new highs.

Wednesday the market was down after the Federal Reserve signaled that slow U.S. GDP growth had reduced the likelihood of an interest-rate hike in June. Investors have often celebrated such stock market news.

But this past week investors instead saw the market glass as half empty, focusing on the Fed’s hint as a sign of weakness that would hurt stocks.

Still, on Thursday the market rose amid rising oil prices. The U.S. dollar fell after rising for three days.

The advance by U.S. diversified stock mutual funds lifted their year-to-date gain to 4.62%.

The leading market capitalization and style category in the latest week was small-cap growth, which gained 1.16%. That extended their gain for the year to 6.87%. That was the best year-to-date advance among market cap and style groups.

Small-cap value, the worst laggards in the week with a 0.44% gain, were also the market cap and style group with the smallest gain for the year, 3.07%.

Health-biotechnology funds gained 2.03% in the latest week to pace sectors. That left them up 15.37% for the year, also tops among sectors.

As the dollar rose most of the week, precious metals funds fell, losing 3.41%, worst among sectors. That cut their year-to-date gain to 5.42%.

World equity funds’ 0.28% gain in the latest week lagged U.S. diversified stock funds’ advance. The gain left world equity funds up 9.48% year to date.

Japanese funds paced the global group in the latest week, gaining 1.73%. That padded their year-to-date gain to 17.94%, second best among global categories. The leader for the year remained China region funds. Their advance stood at 21.80%.

Latin American funds were the global laggards once again in the latest week. They lost 2.56%. That pushed them into negative territory for the year, down 2.45%.

U.S. Treasury funds gained 0.48% in the week. That trimmed their year-to-date loss to 0.98%.

Taxable categories more oriented to take on risk fared worse in the latest week. High-yield funds gained just 0.12%, leaving them up 3.56% for the year.

Taxable bond funds overall eked out a gain of 0.12% on average in the week. That added to their gain for the year, leaving them up 1.28%.

Tax-exempt funds fell 0.16% for the week. That pushed them deeper into negative territory for the year, down 0.22%.

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