VPN - Fed Sparks Sell-Off As Shortages Worsen

• U.S. equity markets slid to their worst week since February after the Federal Reserve accelerated its "lift-off" plans in response to surging inflation, sparking a sell-off in economically sensitive assets.
• Snapping a three-week winning streak and retreating from record-highs set last week, the S&P 500 declined 2.2% on the week while the Mid-Cap 400 and Small-Cap 600 each dipped by 5%.
• Real estate equities were also under pressure despite a wave of dividend increases this week as Equity REITs dipped 3.1% while Mortgage REITs declined by 3.8%. Homebuilders were relative outperformers.
• Soaring prices and supply chain constraints have cooled the pace of new home construction despite a historic and lingering housing shortage. Meanwhile, data this week showed that rents across the country continue to soar.
• The wave of dividend increases continued across the REIT sector as five equity REITs and three mortgage REITs boosted their dividends this past week. REITs are now the top-performing asset class this year.

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