Energy Sector Surges as Large-Cap Tech Weighs on Markets

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Macro Overview

U.S. equities finished mostly lower as investors navigated geopolitical tensions and positioned ahead of key inflation data, with the S&P 500 (IVV) declining 0.32%. In contrast, international markets showed resilience, as Developed ex-U.S. (EFA) and Emerging Markets (EEM) posted modest gains of 0.07% and 0.40%, respectively. A slight risk-off sentiment was evident as fixed income markets, represented by the U.S. Aggregate Bond (AGG), edged up 0.08%. The day’s notable outlier was the positive performance from U.S. small-cap stocks, which bucked the large-cap downtrend.

U.S. Size & Style

A clear divergence emerged between U.S. large-cap and small-cap stocks during the session. Large-cap growth (IVW) led the retreat with a 0.63% loss, pulling the broader S&P 500 into negative territory. Conversely, smaller companies demonstrated strength, with the S&P MidCap 400 (IJH) and S&P SmallCap 600 (IJR) advancing 0.30% and 0.24%, respectively. This rotation suggests a shift in investor sentiment away from the market’s largest names for the day.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
Large Value (IVE) 0.02% 2.55% 5.66% 12.31% 21.15%
Large Cap (IVV) -0.32% 2.13% 4.51% 13.64% 22.61%
Large Growth (IVW) -0.63% 1.64% 3.49% 14.48% 23.46%
Mid Value (IJJ) 0.32% 2.64% 7.31% 15.02% 24.11%
Mid Cap (IJH) 0.30% 2.78% 5.66% 18.40% 26.49%
Mid Growth (IJK) 0.26% 2.86% 4.08% 21.41% 28.64%
Small Value (IJS) 0.30% 2.65% 8.30% 22.56% 38.63%
Small Cap (IJR) 0.24% 1.96% 8.38% 24.06% 35.67%
Small Growth (IJT) 0.23% 1.22% 8.40% 25.36% 32.58%

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U.S. Sectors & Industries

The Energy sector was the standout performer, as the Energy Select Sector SPDR Fund (XLE) climbed 1.25%, fueled by a rise in crude oil prices. Defensive Utilities (XLU) also found favor, gaining 1.16%. On the other end of the spectrum, technology-related sectors weighed on the market, with Communication Services (XLC) falling 0.50% and Real Estate (XLRE) posting the largest decline of 0.72%.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
S&P 500 (SPY) -0.32% 2.07% 4.49% 13.60% 22.51%
Energy (XLE) 1.25% 10.62% 7.34% 38.14% 49.11%
Utilities (XLU) 1.16% -3.92% -2.73% 3.56% 4.38%
Industrials (XLI) 0.60% 2.08% 6.35% 20.34% 25.10%
Materials (XLB) 0.11% 4.62% 2.26% 18.35% 22.98%
Financials (XLF) -0.02% 3.75% 13.33% 6.44% 13.24%
Technology (XLK) -0.12% 0.17% 4.74% 29.57% 41.65%
Health Care (XLV) -0.26% 4.46% 17.97% 9.46% 31.19%
Consumer Staples (XLP) -0.31% 0.68% 2.29% 10.40% 5.63%
Consumer Discretionary (XLY) -0.36% 1.71% 0.09% 0.26% 7.12%
Communication Services (XLC) -0.50% -0.33% -3.47% -4.93% 4.15%
Real Estate (XLRE) -0.72% -0.83% -0.24% 10.93% 11.16%

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Global Thematic

Cannabis-focused strategies dominated the thematic leaderboard, with the AdvisorShares Pure US Cannabis ETF (MSOS) surging 5.23%. Other top performers included funds focused on alternative asset managers and memory chips. Conversely, themes tied to the energy transition faced headwinds, as the VanEck Rare Earth and Strategic Metals ETF (REMX) dropped 2.21% and the Amplify Lithium & Battery Technology ETF (BATT) fell 1.80%.

Name (Ticker) 1-Day
Leaders
AdvisorShares Pure US Cannabis ETF (MSOS) 5.23%
Amplify Seymour Cannabis ETF (CNBS) 4.82%
Amplify Alternative Harvest ETF (MJ) 4.60%
VanEck Alternative Asset Manager ETF (GPZ) 3.53%
Roundhill Memory ETF (DRAM) 2.60%
Laggards
VanEck Rare Earth and Strategic Metals ETF (REMX) -2.21%
Amplify Lithium & Battery Technology ETF (BATT) -1.80%
Sprott Junior Gold Miners ETF (SGDJ) -1.79%
Global X Social Media ETF (SOCL) -1.67%
F/M Emerald Life Sciences Innovation ETF (LFSC) -1.32%

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Developed ex-U.S. & Emerging Markets

Developed international markets were mixed, leading the broad MSCI EAFE index (EFA) to a nearly flat finish. South Korea (EWY) was a notable bright spot with a 2.53% rally, while Hong Kong (EWH) experienced a significant 1.40% decline. Emerging markets posted a collective gain, but this masked substantial weakness in key economies, as Brazil (EWZ) and China (MCHI) fell 3.44% and 2.30%, respectively.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
Developed Markets ex-U.S.
Developed ex-U.S. (EFA) 0.07% 3.60% 5.83% 14.33% 24.22%
Australia (EWA) -0.33% 5.27% 2.65% 15.98% 15.93%
Canada (EWC) 0.02% 4.88% 6.29% 14.59% 31.88%
France (EWQ) -0.13% 5.88% 7.33% 8.52% 15.87%
Germany (EWG) 0.27% 6.03% 5.49% 5.56% 6.97%
Hong Kong (EWH) -1.40% 4.56% -6.09% 7.48% 12.34%
Japan (EWJ) 0.24% 1.83% 4.91% 19.88% 29.14%
Netherlands (EWN) 1.02% 1.94% 7.07% 22.92% 38.98%
South Korea (EWY) 2.53% -8.87% -13.28% 72.02% 134.21%
Switzerland (EWL) -0.51% 1.75% 5.92% 8.68% 22.48%
U.K. (EWU) -0.39% 3.65% 5.03% 11.41% 22.90%
Emerging Markets
Emerging Markets (EEM) 0.40% -2.20% -3.14% 20.20% 35.31%
Brazil (EWZ) -3.44% -5.43% -11.27% 7.98% 28.57%
China (MCHI) -2.30% 4.69% -4.62% -6.80% -1.98%
India (INDA) -0.10% 1.60% 3.45% -7.33% -4.17%
Indonesia (EIDO) -2.12% 5.32% -13.17% -32.07% -28.66%
Malaysia (EWM) 0.11% 2.33% -4.95% 4.71% 18.31%
Mexico (EWW) -0.90% 1.84% -3.57% 11.58% 28.14%
South Africa (EZA) -1.63% 7.47% -2.37% 1.81% 31.11%
Taiwan (EWT) 1.72% -2.12% 6.99% 63.61% 80.37%
Thailand (THD) -1.07% 0.55% 5.12% 25.05% 31.07%

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Fixed Income

Fixed income markets saw a quiet session with a slight upward drift as investors awaited Wednesday’s inflation report. The iShares Core U.S. Aggregate Bond ETF (AGG) gained 0.08%, reflecting a modest bid for safety amid the equity market pullback. Performance was consistent across the curve, with both short-term (BSV) and long-term (BLV) Treasury funds posting small gains. High-yield corporate bonds (HYG) were little changed, up just 0.04%.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
Multisector
Long-Term (BLV) 0.12% -1.93% -2.50% -2.51% -0.22%
Core Enhanced (IUSB) 0.09% -0.33% -0.45% 0.02% 2.65%
Core (AGG) 0.08% -0.43% -0.61% -0.27% 2.27%
Short-Term (BSV) 0.03% 0.19% 0.29% 0.64% 2.66%
Government
Long-Term (SPTL) 0.16% -1.97% -2.42% -2.88% -0.90%
Intermediate (SPTI) 0.11% -0.09% -0.36% -0.47% 1.65%
Short-Term (SPTS) 0.07% 0.32% 0.53% 0.97% 2.91%
Inflation Protected (TIP) 0.03% -0.42% -1.19% 0.58% 1.67%
Ultrashort (BIL) 0.01% 0.29% 0.90% 2.18% 3.76%
Specialty
Mortgage Backed (MBB) 0.12% -0.37% -0.67% 0.15% 3.76%
Bank Loans (BKLN) 0.10% 0.93% 0.89% 1.29% 4.49%
Preferred Stock (PFF) 0.07% 0.63% -2.11% 1.75% 3.60%
Corporate (SPIB) 0.06% -0.01% -0.04% 0.44% 3.00%
Convertible (CWB) 0.06% -1.29% -1.78% 17.28% 24.77%
High Yield (HYG) 0.04% 0.23% 0.87% 2.06% 5.07%
International & EM
International Local (IGOV) 0.12% 0.98% -1.97% -1.01% -0.86%
International USD (BNDX) 0.06% -0.29% 0.38% 0.58% 1.34%
Emerging USD (EMB) -0.01% -0.78% 0.08% 1.53% 6.72%
Emerging Local (EMLC) -0.12% 0.67% 1.51% 2.78% 8.22%
Municipals
Intermediate (MUB) 0.08% -0.74% -0.15% 0.76% 5.01%
Long-Term (MLN) 0.06% -0.62% 0.40% 2.17% 8.15%
Short-Term (SUB) 0.00% 0.18% 0.56% 1.11% 2.07%
High Yield (HYD) 0.00% -1.22% -0.28% 1.25% 6.96%

Explore the related Explorers: Taxable → · Municipal → · Specialty →

Commodities

Energy was the primary driver in the commodities complex, with Brent Crude (BNO) rising 1.70% due to geopolitical concerns. Despite a risk-off tone in equities, precious metals failed to catch a bid, as Gold (GLD) fell 0.39% and Silver (SLV) declined by a more significant 1.45%. Agricultural commodities were also broadly lower, with Wheat (WEAT) down 1.25%.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
Broad Commodities (DJP) -0.02% 7.49% -4.40% 28.90% 44.37%
Agriculture
Sugar (CANE) 1.21% 10.40% 7.76% 11.02% -1.63%
Corn (CORN) -0.40% 0.51% -6.34% -0.90% 2.51%
Broad (DBA) -0.83% -0.65% -2.61% 8.11% 7.32%
Soybeans (SOYB) -0.98% -0.98% -0.63% 14.01% 15.54%
Wheat (WEAT) -1.25% -0.04% -1.17% 18.73% 10.54%
Energy
Brent Crude (BNO) 1.70% 20.90% -7.38% 79.94% 71.58%
WTI Crude (USO) 1.34% 17.40% -7.97% 84.51% 72.91%
Broad (DBE) 1.28% 16.32% -1.80% 80.76% 74.61%
Natural Gas (UNG) -0.69% -5.00% -10.25% -17.86% -22.95%
Industrial Metals
Copper (CPER) 0.10% 5.87% 2.11% 15.05% 45.25%
Broad (DBB) 0.08% 5.07% -0.89% 11.99% 35.25%
Precious Metals
Gold (GLD) -0.39% 6.35% -7.75% 1.17% 29.95%
Broad (DBP) -0.62% 6.72% -12.15% -1.93% 34.97%
Platinum (PPLT) -0.82% 6.84% -18.22% -15.36% 30.43%
Palladium (PALL) -1.35% 7.37% -9.87% -14.81% 18.28%
Silver (SLV) -1.45% 8.53% -24.94% -9.11% 71.30%

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Cryptocurrency

Digital assets traded lower, generally moving in tandem with the decline in large-cap technology stocks. The market leader, Bitcoin (IBIT), slipped 0.80% on the day. Ethereum (ETHA) proved to be an exception to the negative trend, managing to post a small gain of 0.28%. Overall, the cryptocurrency space reflected the cautious sentiment prevailing in other risk asset classes.

Name (Ticker) 1-Day 1 Month 3 Month YTD 1 Year
Multi-Coin (NCIQ) -0.94% -0.54% -23.03% -30.45% -50.81%
Solana (SOLZ) -0.92% -2.90% -23.47% -39.94% -60.00%
Bitcoin (IBIT) -0.80% -0.80% -22.66% -27.61% -46.87%
XRP (XRP) -0.70% -8.27% -31.64% -44.83%
Ethereum (ETHA) 0.28% 4.80% -19.75% -36.78% -56.03%

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What to Watch Today

Investors will be closely watching Wednesday’s economic calendar, which is highlighted by the release of the Consumer Price Index (CPI) for July at 8:30 AM ET. The Core CPI figure, which excludes food and energy, will be released simultaneously and is a key metric for inflation expectations. Other notable events include the weekly EIA Crude Oil Inventories report, a 10-Year Note auction in the afternoon, and the Treasury’s monthly budget statement.

This material is for informational purposes only and should not be considered investment advice. All investments, including ETFs, involve risk, including the possible loss of principal. Investors should consider their investment objectives, risks, charges, and expenses carefully before investing.

This analysis was developed by the team at ETF Action. We leverage advanced AI tools to assist in the drafting and refinement of our content, based on our expert prompts, direction, and final review.