Current market environment performance of dynamic, risk-managed investment solutions.
By Daniel Poppe
Market snapshot
• Stocks: The major U.S. stock market indexes moved higher last week. The Dow Jones Industrial Average gained 3.19%, the S&P 500 rose 4.55%, the Russell 2000 advanced 5.57%, and the NASDAQ Composite added 6.84%.
• Bonds: The 10-year Treasury yield fell from 4.31% to 4.26% last week.
• Gold: Spot gold rose 1.70% last week, closing above $4,800 an ounce.
• Market indicators and outlook: Market regime indicators show the market is in a Normal economic environment stage, which is historically positive for stocks, bonds, and gold but with a substantial risk of a downturn for gold. Normal is one of the best stages for stocks, with limited downside. Volatility is High and Rising, which favors stocks over gold and then bonds.
***
For the latest information on our Quantified Funds, check out our weekly fund updates. You can also see the daily holdings of the funds here.
Stocks
The SPDR S&P 500 ETF (SPY), which tracks the performance of the S&P 500, finished the week above both its 50-day and 200-day moving averages.
Stocks have staged an impressive rebound, reaching new all-time highs. Investor fears eased significantly after Iran signaled a willingness to negotiate with the United States to bring the conflict in the Middle East to a close. Talks between the two countries have focused in part on the extent to which vessels will be able to move through the Strait of Hormuz, a key global shipping route, particularly for crude oil.
With the prospect of calmer international relations in the near future, investors are also keeping an eye on AI developments. Productivity gains from those developments could help support corporate earnings. First-quarter 2026 earnings season is now underway. FactSet’s Earnings Insight report shows that most of the 10% of S&P 500 companies that have reported so far have posted better-than-expected results. Earnings growth has also been strong, with the blended rate in the double digits. Even so, valuations for the Index remain above historical averages.
Bonds
The iShares 7-10 Year Treasury Bond ETF (IEF), which tracks intermediate-term Treasury bonds, finished last week above both its 50-day and 200-day moving averages.
While not as strong as stocks, bonds also rallied last week. Easing tensions in the Middle East and an improved outlook for energy supplies reduced concerns about future inflation and helped lift bond prices.
Even with the improved inflation outlook, CME Group data still suggests the Federal Reserve is expected to leave rates unchanged at its April meeting next week. In fact, current expectations point to no rate changes in the near term. Market pricing shows a high probability that the Federal Open Market Committee will leave rates unchanged at its remaining meetings this year. The Fed appears to view current rate levels as appropriate for balancing its goals of stable prices and maximum employment.
Gold
The SPDR Gold Shares ETF (GLD), which tracks the price of gold, finished the week below its 50-day moving average but above its 200-day moving average.
Flexible Plan Investments (FPI) is the subadviser to the only U.S. gold mutual fund, The Quantified Gold Futures Tracking Fund, formerly The Gold Bullion Strategy Fund. Launched in 2013, the fund is designed to track the daily price changes in the precious metal in a more tax-efficient manner than its ETF counterpart, GLD.
FPI’s indicators
The QFC S&P Pattern Recognition strategy’s primary signal started the week with a 90% net short exposure to the S&P 500. Exposure changed to 110% net short on Monday, 90% net short on Tuesday, 120% net short on Wednesday, 170% net short on Thursday, and 150% net short on Friday.
Our QFC Political Seasonality Index strategy was aggressive at the beginning of the week, then shifted to a defensive posture on Friday. (Our QFC Political Seasonality Index—with all of the daily signals—is available post-login in our Weekly Performance Report section under the Domestic Tactical Equity category.)
The Volatility Adjusted NASDAQ strategy started the week with a 20% net short exposure to the NASDAQ 100. Exposure changed to 0% on Monday, 20% net long on Tuesday, and 60% net long on Thursday.
The Systematic Advantage strategy started the week with a 30% net long exposure to the S&P 500. Exposure changed to 60% net long on Thursday, then moved back to 30% net long on Friday.
Our QFC Self-adjusting Trend Following Strategy’s primary signal was 0% net long going into the week. Exposure changed to 200% net long the NASDAQ 100 on Monday.
The Volatility Adjusted NASDAQ, Systematic Advantage, QFC Self-adjusting Trend Following, and QFC S&P Pattern Recognition strategies can all employ leverage, so the investment positions may at times exceed 100%.
Our Classic model remained in stocks throughout last week. Most of our Classic accounts follow a signal that will allow the strategy to change exposure in as little as a week. A few accounts are on platforms that are more restrictive and can take up to one month to generate a new signal.
FPI’s Growth and Inflation measure is one of our Market Regime Indicators. It shows that we are in a Normal economic environment stage (meaning a positive monthly change in prices and a positive monthly change in GDP). Historically, a Normal environment has occurred 75% of the time since 2003 and has been a positive regime state for stocks, bonds, and gold. Stocks have the highest rate of return in Normal periods. Gold has the second highest return but has also experienced high drawdown in these environments.
Our S&P volatility regime is registering a High and Rising reading, which favors stocks over gold and then bonds from an annualized return standpoint. The combination has occurred 28% of the time since 2003.