Strong Earnings Offset Stagflation Fears
U.S. equity markets rallied for the third straight week - with the major indexes recapturing record highs - following a strong start to corporate earnings season which temporarily quelled stagflation concerns.
Rallying for the third straight week to fresh record highs following a September stumble, the S&P 500 gained 1.6% on the week while Mid Caps rallied 1.7% and Small Caps advanced 1.2%.
Real estate equities led the way once again this week, powered by a strong start to earnings season, a continued wave of dividend hikes, and a flurry of M&A developments.
Strong results from Equity LifeStyle, Crown Castle, and Rexford were highlights of the REIT earnings slate this week. On the M&A front, two technology REITs - CyrusOne and Uniti - may be nearing a sale.
Homebuilders were also among the leaders following strong earnings reports and a better-than-expected slate of housing data including a report showing the historic surge in rents has shown few signs of cooling.
Disclosure: Hoya Capital Real Estate advises two Exchange-Traded Funds listed on the NYSE. In addition to any long positions listed below, Hoya Capital is long all components in the Hoya Capital Housing 100 Index and in the Hoya Capital High Dividend Yield Index. Index definitions and a complete list of holdings are available on our website.
Additional Disclosure: It is not possible to invest directly in an index. Index performance cited in this commentary does not reflect the performance of any fund or other account managed or serviced by Hoya Capital Real Estate. Data quoted represents past performance, which is no guarantee of future results. Information presented is believed to be factual and up-to-date, but we do not guarantee its accuracy.