Most corners of global markets fell last week—with two conspicuous exceptions: US-listed real estate investment trusts and bonds, based on a set of exchange-traded funds. Otherwise, red ink prevailed.

Vanguard Real Estate (VNQ) extended its bull run last week, rising to a record close before edging back on Friday, Sep. 27 and posting a solid 0.4% weekly advance. Year to date, VNQ is also in the lead — a rally that inspires a claim that securitized real estate has become “the new flight-to-quality asset class.”

A broad measure of investment-grade US bonds also bucked the downside trend last week. Vanguard Total Bond Market (BND) edged up 0.2%, extending a rebound after a sharp drop earlier in September.

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Investors were worried earlier this month that the long slide in yields was at risk of reversing. But sentiment, once again, appears to favor lower rates, fueling the latest rise in bond prices (and a commensurate drop in yields).

“It is very difficult to imagine a situation where you get a significant upward move in yields,” says Beata Caranci, chief economist at TD Bank. “There is clearly a political element at work and then there is policy easing from central banks, which together are anchoring yields lower. While you can certainly get the risk premium priced-out on the political side, the economic and international side will continue to weigh.”

The biggest setback last week was in broadly defined commodities. The iShares S&P GSCI Commodity-Indexed Trust (GSG) tumbled 2.3%.

An ETF-based version of the Global Market Index (GMI.F) was under pressure from the broad-based losses last week. This unmanaged benchmark, which holds all the major asset classes (except cash) in market-value weights, fell 0.8%, the benchmark’s second back-to-back weekly decline.

In a now-familiar pattern, US REITs also lead the major asset classes for one-year results. VNQ is up 21.3% on a total return basis for the past year. The gain is striking in that the rest of the field is well behind the REIT rally.

Another familiar sight for one-year performance: broadly defined commodities were dead last. GSG is off 15.2% as of Friday’s close vs. the year-earlier price.

Meanwhile, GMI.F is holding on to a modest 3.0% increase for the one-year trailing window.

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Finally, note that a momentum-based profile of the major asset classes continues to reflect a bullish posture. Despite last week’s broad-based set back, an upside bias remains intact, based on two sets of moving averages for the ETFs listed above. The first compares the 10-day moving average with its 100-day counterpart — a proxy for short-term trending behavior (red line in chart below). A second set of moving averages (50 and 200 days) represent an intermediate measure of the trend (blue line). At the close of last week’s trading, positive momentum remained the dominant theme, according to this data.

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