Issue link: http://www.insightdigital.biz/i/533571
40 | I NSIGH T • J u l y 2 0 15 w w w . i n s i g h t o n b u s i n e s s . c o m F or years now, the story has been the same. e Federal Reserve has stuck to its zero-interest rate policy with the expectation to raise rates in the future. However, the Fed hasn't announced exactly when this will happen, yet rates are already rising. What gives? Let's take a look at the 10-year treasury yield. Rates for this treasury bottomed in January, yielding a grand total of 1.67 percent. In fact, this is a historical bottom, as rates for this treasury have never been so low. Since then, this treasury yield has risen to 2.35 percent. at's a 40 percent increase in six months! is rate rise is seen across short-, medium- and long-term treasuries as well, so it's not just an isolated event. So if the Fed isn't officially raising rates, then who is? Well, it's anyone's guess as to which market participants are responsible. Could it be that investors are selling and buying into rising equity markets? Could it be that investors are diversifying from treasuries into other asset classes like commodities? It could mean one, both or none of these things. As the saying goes, "an economist is an expert who will know tomorrow why the things he predicted yesterday didn't happen today." One thing is for sure, rates are starting to rise and markets haven't quite taken notice yet. clearTREND research produced by our firm in Appleton indicates upward trends in U.S. equities despite recent weakness in domestic real estate. Our U.S. Economic Health Index shows that 50 percent of U.S. sectors are expanding while 29 percent are contracting. "In today's rising rate environment, it is important to keep an eye on assets that are especially susceptible to rate changes," says Alexander Hunt, adviser to private clients and retirement plans. "For example, we've seen recent weakness in the real estate market, which could become a trend once Janet Yellen and the Fed initiate an official rising rate policy." KEY: = uptrend = downtrend Ticker = trading symbol (individual securities only) Trend Began = date on which current trend was identified Confidence = clearTREND's historic success rate in generating capital gains based on accurate trend identification clearTREND U.S. Economic Health Index: trending i n fo c u s Interest rates begin the move upward Rising rates: the beginning of the end? This index measures more than 130 unique U.S. market sectors to determine how many are expanding, stable or contracting. More than 50 percent of expanding sectors are healthy, while less than 50 percent are not. 50% Expanding: 50% Neutral: 21% Contracting: 29% Poor Fair Good Excellent Data as of 6/11/2015 Sector Focus: Health Care Description Ticker Trend Began Confidence Actavis Inc. ACT 5/9/14 99.00% Amgen Inc. AMGN 6/11/15 77.86% CVS Caremark Corporation CVS 10/28/11 86.27% Gilead Sciences Inc. GILD 4/29/15 86.11% Johnson & Johnson JNJ 5/20/15 78.97% Merck & Co Inc. MRK 5/7/15 77.51% Pfizer Inc. PFE 6/3/15 77.57% UnitedHealth Group Inc. UNH 1/11/13 80.31% Business Lending Description Ticker Trend Began Confidence BB&T Corporation BBT 5/19/15 75.57% Fifth Third Bancorp FITB 5/4/15 80.00% KeyCorp KEY 1/28/15 79.13% M&T Bank Corporation MTB 3/9/15 78.21% PNC Financial Services GroupThe PNC 11/7/14 85.71% Regions Financial Corporation RF 4/22/15 78.14% Suntrust Banks Inc. STI 10/31/14 71.03% US Bancorp USB 11/5/14 72.73%