Commercial Real Estate Sector Surges
Among the sectors that began to show relative strength this week, the commercial real estate sector stands out. This sector had begun to lag behind the market since early November, but its moves over the past three days suggest that it may not remain that way for much longer.
The chart above shows how State Street's SPDR S&P Real Estate ETF (XLRE) has more than doubled the S&P 500 performance over the past few trading sessions. With interest rates expected to remain firm for 2020, investors and landlords can plan on enjoying historically low rates on their rental inventory for another year.
The importance of this price action is less about the real estate sector and more the need for astute chart watchers to recognize just how broad the current asset-based rally is. It is almost as if the market is marching to a mantra of "no sector left behind." Investors keep finding new ways to display their preference for seeking investment opportunity and telegraph their bullish bias.