The major market indexes were trading in record high territory Tuesday as Apple (AAPL) and Microsoft (MSFT) led the Dow Jones industrial average.
X PowerShares QQQ Trust (QQQ) rallied 1% to a new record high, SPDR Dow Jones Industrial Average (DIA) rose 0.7% and SPDR S&P 500 (SPY) advanced 0.6%.
Emerging markets outperformed as iShares MSCI Emerging Markets (EEM) gapped up and soared 1.5% to its highest level since August 2011. Hong Kong's Hang Seng index jumped nearly 2%.
U.S. small caps also rallied: iShares Core S&P Small Cap (IJR) and iShares Russell 2000 (IWM) rose more than 1% each.
Among blue chips in the stock market today, Apple and Microsoft led with respective gains of 2% and 1%. Apple is extended from a 160.97 cup-with-handle buy point. Microsoft is also extended. All 30 Dow stocks were up.
Metals miners, chips and telecom were some of the biggest sector fund gainers. Oil and gold ETFs also advanced along with their underlying commodity prices. But retail and banks lagged,
'Quality' Dividends?
Investors who favor Steady Eddy-type stocks such as 3M (MMM), General Dynamics (GD) and IBM (IBM) have a chance to snap up these names and more.
PowerShares S&P 500 Quality (SPHQ) is in buy range from a pullback to the 50-day moving average. A solid rebound off the support line Thursday triggered a potential buy opportunity. Shares advanced 5% from their last bounce off the 50-day in early September.
The fund, which tracks the S&P 500 Quality Index, has gathered $1.3 billion in assets since its December 2005 launch. The index comprises S&P 500 companies with strong balance sheets and stable earnings growth. Companies making the index carry the highest quality scores based on fundamental metrics including profitability, earnings quality and financial risk.
Stocks in the portfolio are capped at 5% each. The index and fund are rebalanced and reconstituted twice a year, in June and December. The fund normally invests at least 90% of assets in stocks that make up the index.
Industrials represented the biggest sector weighting at nearly 22% of assets as of Nov. 17. Information technology made up 19.5%, consumer discretionary 17%, consumer staples 15% and health care 13%. Materials, financials, real estate and energy made up the rest.
The three names mentioned up top are all S&P 500 Dividend Aristocrats, companies that have increased their dividends for at least 25 years in a row. Other holdings in the portfolio include Boeing (BA), Delta Air Lines (DAL) and Raytheon (RTN). Boeing has soared 70% this year, while 3M and Raytheon are up about 30% apiece. One of its top holdings was General Electric (GE), which dived last week after slashing its dividend by half. Shares are down more than 40% year to date.
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SPHQ has returned 14.5% year to date through Nov. 20, according to Morningstar Direct, trailing the S&P 500's 17.3% gain. Its average annual returns over the past three years is just ahead of the benchmark index at 10.7% vs. 10.4%. It lags over the past five and 10 years with respective returns of 15.9% and 6.9%, less than 2 percentage points shy of the S&P 500.
SPHQ bears a 0.29% expense ratio.
Two China ETFs highlighted in Monday's column are both near buy points. EMQQ Emerging Markets Internet & Commerce (EMQQ) remains in buy range from a 38.01 flat-base entry; Global X China Consumer (CHIQ) climbed past an 18.25 flat-base buy point intraday but closed just below the entry.
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