ETF Action: Research

9.29.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: U.S. markets rallied on Wednesday following six consecutive losing sessions by the S&P 500 (SPY) and the Dow Jones Industrial Average (DIA). SPY gained 1.97% and DIA added 1.86% while the NASDAQ 100 (QQQ) climbed 1.99%. Small-Caps were strong with the Russell 2000 (IWM) surging 3.16%. The U.S. 10-Year Treasury Yield touched 4.00% intraday before sinking lower. The British pound was also stabilized by the Bank of England saying it would buy bonds to stabilize its financial markets. Investors will be looking forward to the U.S. gross domestic product (GDP) release on Thursday morning. Growth heavy pockets of the markets outperformed with S&P 500 High Beta (SPHB) rising 2.93% and S&P 500 Pure Growth (RPG) jumping 2.81%. All U.S. factors posted solid gains for the day with S&P 500 Pure Value (RPV) increasing 2.34%. Developed ex-U.S. Markets (EFA, +2.41%) were bolstered by Germany (EWG, +3.23%) and Switzerland (EWL, +3.22%) while Emerging Markets (EEM, +87 bps) benefited from Mexico (EWW) and South Africa (EZA) both rising over 2%.

Sectors: All U.S. sectors rose over 1% yesterday led by Energy (XLE, +4.43%) and Communication Services (XLC, +3.41%). XLE was bolstered by Oil & Gas Exploration & Production (XOP) which jumped 6.56%. Consumer Discretionary (XLY), Materials (XLB), Industrials (XLI), and Health Care (XLV) all climbed more than 2%. Biotech (XBI, +5.15%) provided a boost for XLV while Metals & Mining (XME, +4.63%) had another strong showing, lifting XLB. Financials (XLF) and Real Estate (XLRE) also gained 1.97% and 1.89%, respectively. All industries ended the day in positive territory. Despite Wednesday's repreive from recent weakness, all sectors are still trading well below relative 50-day and 200-day moving averages.

Themes: Excellent day for global themes on Wednesday with all thematic segments up over 1.40% and most segments up over 2.50%. Genomics (ARKG) was the best performing segment surging 6.17% followed by Biotech (SBIO, +5.00%), Multi-Theme (ARKK, +4.66%), and Cannabis (MJ, +4.45%). Currently, Cannabis (MJ sits 67.95% from 52-week highs and Multi-Theme (ARKK) sits 68.04% from 52-week highs. Only one thematic ETF posted losses on Wednesday: the KraneShares MSCI China Clean Technology Index ETF (KGRN, -37 bps). 

Commodities & Yields: The U.S. Dollar (UUP) sunk 1.30%, U.S. Aggregate Bonds (AGG) rose 1.61%, and 20+ Year Treasury Bonds (TLT) shot up 3.35%. At yesterday’s closing bell, the U.S. 10-Year Treasury Yield stood at 3.725% while the U.S. 2-Year Treasury Yield stood at 4.123%. Broad Commodities (DJP) finished up 2.64% as Energy (DBE) added 3.43%, Precious Metals (DBP) rose 2.34%, and Industrial Metals (DBB) increased 2.00%. WTI Crude Oil (USO) was up 4.21%, Gasoline (UGA) higher by 3.47%, Lead (LD) climbed 6.00%, and Gold (GLD) rose 2.08%.

9.28.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: On Tuesday, the NASDAQ 100 (QQQ) snapped its 5-day losing streak as it added 4 bps while the Dow Jones Industrial Average (DIA, -49 bps) and the S&P 500 (SPY, -26 bps) posted losses for the 6th consecutive session. DIA and SPY hit new 52-week lows and are down 22.61% and 18.65% year-to-date, respectively. QQQ has sunk 30.67% thus far in 2022. All three moving averges sit in oversold territory and are trading well below relative 50-day and 200-day moving averages. The U.S. 10-Year Treasury Yield continued to inch higher towards 4% yesterday. St. Louis Fed Chief James Bullard indicated further interest rate hikes would be necessary yesterday further weakening investor sentiment. Growth-oriented pockets of the markets outperformed with S&P 500 High Beta (SPHB, +74 bps) and S&P 500 Pure Growth (RPG, +44 bps) leading other U.S. factors on the day. S&P 500 Low Volatility (SPLV, -1.25%) and S&P 500 Dividend (SPYD, -75 bps) were the worst performing factors. Hong Kong (EWH) dropped 1.57% on Tuesday, dragging Developed ex-U.S. Markets (EFA, -68 bps) lower while Emerging Markets (EEM) dipped just 11 bps.

Sectors: Energy (XLE) gained 1.12% yesterday outpacing other U.S. sectors as Oil & Gas Exploration & Production (XOP) and Oil & Gas Equipment & Services (XES) both rose over 2%. XLE sits 31.15% above 52-week lows. Consumer Discretionary (XLY, +31 bps), Materials (XLB, +22 bps), and Technology (XLK, +13 bps) were the only other sectors to post gains on Tuesday. Metals & Mining (XME) climbed 2.83%, providing a boost for XLB. Consumer Staples (XLP, -1.73%), Utilities (XLU, -1.68%), and Real Estate (XLRE, -1.32%) were weak. All sectors are still trading well below relative 50-day and 200-day moving averages.

Themes: Tuesday was a relatively strong session for global themes amid recent weakness as most thematic segments saw postive returns. Biotech (SBIO) surged 2.41% and was the best performing segment. Cannabis (MJ), Genomics (ARKG), Solar (TAN), Multi-Theme (ARKK), and Disruptive Tech (ARKW) all gained over 2% while Clean Energy (PBW) added 1.64%. Only two thematic segments fell more than 1%: Water (PHO, -1.12%) and Space (UFO, -1.05%). All thematic segments have posted losses across the 1-month, year-to-date, and 1-year periods.

Commodities & Yields: Broad Commodities (DJP) were relatively flat on the day as Natural Gas (UNG) fell 3.30%, WTI Crude Oil (USO) rose 1.93%, and Lead (LD) dropped 6.48%. U.S. Aggregate Bonds (AGG) sunk 43 bps, 20+ Year Treasury Bonds (TLT) decreased 2.63%, and the U.S. Dollar (UUP) was up 3 bps. At Tuesday's close, the U.S. 10-Year Treasury Yield stood at 3.984% and the U.S. 2-Year Treasury Yield stood at 4.312%.

9.27.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Another day of declines for U.S. markets on Monday amid surging rates and bond yields. The Dow Jones Industrial Average (DIA) sunk 1.06%, the S&P 500 (SPY) dipped 99 bps, and the NASDAQ 100 (QQQ) fell 41 bps. All three major averages have posted losses for five straight sessions and SPY and DIA both sit at 52-week lows. Mid-Caps (IJH) and Small-Caps (IJR) fell 1.54% and 1.53%, respectively, yesterday. The U.S. 10-Year Treasury Yield surged above 3.90% intraday, reaching the highest level since 2010, and the U.S. 2-Year Treasury Yield jumped above 4.30%, reaching the highest level since 2007. The British pound also dropped to a record low against the U.S. dollar on Monday. All U.S. factors were down yesterday with S&P 500 Dividend (SPYD, -2.06%) and S&P 500 Pure Value (RPV, -1.91%) lagging. As European markets continued to underperform, Developed ex-U.S. Markets (EFA) declined 1.48%. South Korea (EWY) also sunk 2.08%. Emerging Markets (EEM) fell 1.22% as Brazil (EWZ) plunged 4.72%.

Sectors: Consumer Staples (XLP) rose 7 bps and was the only U.S. sector to post positive returns on Monday. Real Estate (XLRE, -2.70%), Energy (XLE, -2.45%), and Utilities (XLU, -2.41%) all underperformed while Communication Services (XLC), Materials (XLB), Financials, and Industrials (XLI) all sunk more than 1%. All industries were in the red with Oil & Gas Exploration & Production (XOP, -3.19%) falling the furthest. All sectors are trading below relative 50-day and 200-day moving averages and Health Care (XLV) and Consumer Discretinoary (XLY) are the only sectors not sitting in oversold territory. 

Themes: All thematic segments saw losses on Monday with most segments dropping more than 1%. Wind (FAN, -2.76%), Digital Infrastructure (SRVR, -2.60%), Cannabis (MJ, -2.53%), and Digital Payments (IPAY, -2.11%) were the worst performing segments. Currently, just 5.45% of FAN's holdings are currently trading above relative 50-day moving averages. Only 6 thematic ETFs were in positive territory yesterday. The KraneShares CSI China Internet ETF (KWEB) was one of the best performers rising 1.89%. KWEB is down over 16% and has seen $462 million in net outflows over the past month.

Commodities & Yields: The U.S. Dollar surged 1.12%, U.S. Aggregate Bonds (AGG) dipped 1.29%, and 20+ Year Treasury Bonds (TLT) declined 1.91%. At market close, the U.S. 10-Year Treasury Yield stood at 3.902% and the U.S. 2-Year Treasury Yield stood at 4.313%. Broad Commodities (DJP) sunk 1.96% with all broad based sectors finishing lower. Energy (DBE) and Industrial Metals (DBB) both dropped more than 2%. WTI Crude Oil (USO) plunged 3.25% and Nickel (JJN) dropped 5.38%.

9.26.2022

An overview of the broad U.S. Size & Style ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• Small-cap beta and large-cap beta only categories to see net inflows last week
• All sizes and styles down at least 6% in September, Large-cap Value leading in performance MTD (-6.03%)
• Vanguard Russell 2000 Growth ETF (VTWG) lagging all size & style ETFs over the past month, down 12.96%
• All sizes and styles testing lows last seen in June

9.25.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: On Friday, the losing streak was extended to four straight sessions for U.S. markets as investors remained weary of further interest rate hikes by the Federal Reserve. The S&P 500 (SPY) fell 1.68%, the NASDAQ 100 (QQQ) declined 1.63%, and the Dow Jones Industrial Average (DIA) dropped 1.55%. Last week, major averages were down, marking the 4th week in negative territory in the last 5 weeks. QQQ sunk 4.60%, SPY dipped 4.57%, and DIA decreased 3.96%. DIA now sits at 52-week lows while SPY sits just 57 bps above 52-week lows and QQQ sits 1.52% from 52-week lows. All U.S. factor strategies finished lower once again with S&P 500 Momentum (SPMO) and S&P 500 Pure Value (RPV) falling 2.80% and 2.55%, respectively. All factors were in the red for the week with growth-oriented pockets of the markets underperforming. S&P 500 Pure Growth (RPG) dropped nearly 7% on the week. Developed ex-U.S. Markets (EFA) declined 3.19%, pulled lower by the U.K. (EWU, -5.37%) and Germany (EWG, -4.02%). Emerging Markets (EEM) fell 2.47% as South Africa (EZA) and Brazil (EWZ) both sunk more than 4%.

Sectors: All U.S. sectors finished lower on Friday with Energy (XLE) plummeting 6.90% on weakness from Oil & Gas Equipment & Services (XES, -8.80%) and Oil & Gas Exploration & Production (XOP, -8.06%). Consumer Discretionary (XLY) and Materials (XLB) both declined more than 2% followed by Communication Services (XLC, -1.94%), Industrials (XLI, -1.88%), Consumer Staples (XLP, -1.70%, and Financials (XLF, -1.58%). XLI, XLB, XLC, and Real Estate (XLRE) are currently trading at 52-week lows. Last week, XLE declined 9.17%, XLY dropped 7.10%, and XLRE fell 6.32%. All sectors posted losses for the week. 

Themes: Global themes underperformed on Friday with all thematic segments falling more than 1%. Advanced Materials (REMX) was the worst performing segment declining 6.68%. Clean Energy (PBW) and Casinos & Gaming (BETZ) both dropped more than 4%. NextGen Transportation (DRIV) and Solar (TAN) both decreased more thant 3.50% on the day. Casinos & Gaming (BETZ) and Clean Energy (PBW) were the worst performing segments last week dropping 13.59% and 12.11%, respectively. 18 of the 28 thematic segments currently sit at 52-week lows and 14 currently sit in oversold territory. 

Commodities & Yields: The U.S. 10-Year Treasury Yield touched an 11-year high of 3.829% intraday but stood at 3.689% at Friday's close. The 2-Year Treasury Yield hit a 15-year high intraday of 4.266% but stood at 4.190% at Friday's close. U.S. Aggregate Bonds (AGG) fell 31 bps, 20+Year Treasury Bonds (TLT) rose 41 bps, and the U.S. Dollar (UUP) jumped 1.57%. Braod Commodities (DJP) plunged 3.63% with all broad based sectors decreasing. WTI Crude Oil (USO) fell 5.29%, Natural Gas (UNG) dropped 4.29%, and Tin (JJT)fell 6.53%.

9.23.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: U.S. markets posted losses for the third consecutive session on Thursday amid renewed recession fears stemming from the 5^th interest rate hike in 2022 and the 3^rd straight 75-bps rate increase on Wednesday. The NASDAQ 100 (QQQ) sunk 1.23%, the S&P 500 (SPY) declined 84 bps, and the Dow Jones Industrial Average (DIA) fell 43 bps. Small-Caps were battered with the Russell 2000 (IWM) dropping another 2.25%. Rates continued to surge with the 10-Year Treasury Yield rising above 3.70% and the 2-Year Treasury Yield jumping above 4.15% intraday. Growth-oriented pockets of the markets were weak with S&P 500 High Beta (SPHB, -2.93%) and S&P 500 Pure Growth (RPG, -2.35%) lagging other U.S. factor strategies. All factors saw declines yesterday with S&P 500 Pure Value (RPV) lower by 93 bps. Emerging Markets (EEM, -46 bps) were dragged lower by Taiwan (EWT, -1.20%) and Developed ex-U.S. Markets (EFA) dropped 29 bps as European Markets underperformed. Both EEM and EFA sit at 52-week lows.

Sectors: Health Care (XLV) gained 53 bps on Thursday and was the only U.S. sector to finish in positive territory. Consumer Discretionary (XLY) fell another 2.31% and trailed other sectors while Financials (XLF, -1.68%), Industrials (XLI, -1.51%), Materials (XLB, -1.20%), and Technology (XLK, -1.02%) were also weak. All sectors are currently trading below relative 50-day moving averages. Internet (XWEB, -3.44%) and Semiconductors (XSD, -3.29%) pulled XLK down. XLK has now fallen 12.71% over the past month. Pharmaceuticals (XPH, +96 bps) was the only industry to post gains on the day.

Themes: Weakness continued for global thematics yesterday as all segments declined more than 1.25%. Cannabis (MJ) plunged 5.62%, lagging other segments. Disruptive Tech (ARKW, -4.47%), Multi-Theme (ARKK, -4.29%), and Clean Energy (PBW, -4.08%) followed while Casinos & Gaming (BETZ), Solar (TAN), Online Retail (IBUY), FinTech (FINX), and Cloud Computing (SKYY) all dropped more than 3%. Year-to-date, Disruptive Tech (ARKW), Multi-Theme (ARKK), Cannabis (MJ), Online Retail (IBUY), and Blockchain (BLOK have all fallen more than 50%.

Commodities & Yields: Broad Commodities (DJP) decreased 92 bps with Natural Gas (UNG) falling 6.75%. UNG is down 25.57% over the past month, but  remains up 101.36% thus far in 2022. U.S. Aggregate Bonds (AGG) declined 1.07%, 20+ Year Treasury Bonds (TLT) fell 2.55%, and the U.S. Dollar (UUP) rose just 13 bps. The U.S. 10-Year Treasury Yield stood at 3.702% at yesterday's close.

9.22.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: The losses continued for U.S. markets on Wednesday following a widely expected 75-bps interest rate increase by the Federal Reserve to the range of 3%-3.25%. After starting the session in positive territory, the NASDAQ 100 (QQQ) finished down 1.79% while the S&P 500 (SPY) and the Dow Jones Industrial Average (DIA) finished down 1.74% and 1.70%, respectively. The 2-Year Treasury Yield also topped 4.1% intraday for the first time since 2007 and the 10-Year Treasury Yield touched 3.64%, the highest level since February 2011. Fed Chairman Jerome Powell also indicated that the central bank plans to stay aggressive with future rate hikes to battle historically high inflation and Fed officials now expect the so called “terminal rate” to reach 4.6%. All U.S. factor strategies dropped more than 1% yesterday. S&P 500 High Beta (SPHB, -2.17%) and S&P 500 Growth (SPYG, -1.76%) lagged. Emerging Markets (EEM) sunk 1.67% as China (MCHI) plummeted nearly 3% and Developed ex-U.S. Markets (EFA) declined 1.31% on weakness from Australia (EWA, -2.03%).

Sectors: All U.S. sectors posted losses for the second consecutive session with Communication Services (XLC, -2.45%) and Consumer Discretionary (XLY, -2.37%) underperforming. Materials (XLB) and Financials (XLF) also dropped more than 2% while Health Care (XLV) and Technology (XLK) fell more than 1.50%. XLC, XLB, and Real Estate (XLRE) all sit at 52-week lows while XLK and XLY sit nearly 30% from 52-week highs.  All industries were also in negative territory on Wednesday. Biotech (XBI) plunged another 3.49% and Pharmaceuticals (XPH) decreased 2.53%. 

Themes: Another dismal day for global themes as all thematic segments declined on Wednesday. Casinos & Gaming (BETZ, -3.81%), Biotech (SBIO, -3.63%), and Evolving Consumer (SOCL, -2.77%) fell the furthest. Genomics (ARKG), Multi-Theme (ARKK), and Online Retail (IBUY) all sunk more than 2.50%. Cannabis (MJ, -38 bps), Wind (FAN, -41 bps), and Advanced MAterials (REMX, -42 bps) were the best performing segments. Just 4 thematic ETFs posted gains on Wednesday, 2 Cannabis ETFs (MJUS & MSOS), 1 Blockchain ETF (BKCH), and 1 Clean Energy ETF (RNRG). 

Commodities & Yields: Despite rising sharply intraday, the U.S. 10-Year Treasury Yield stood at 3.52% at yesterday’s close. The U.S. Dollar (UUP) jumped 98 bps, U.S. Aggregate Bonds (AGG) rose 32 bps, and 20+ Year Treasury Yield (TLT) increased 1.68%. Broad Commodities (DJP) dipped 20 bps as Industrial Metals (DBB) dropped 1.49%. Copper (CPER) decreased 1.66%, Gold (GLD) increased 46 bps, Natural Gas (UNG) rose 1.12%, and WTI Crude Oil (USO) declined 78 bps.

9.21.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: The selloff continued for major averages yesterday ahead of the Fed announcement on Wednesday which will likely include a 75-bps interest rate hike. The 2-Year Treasury Yield and the 10-Year Treasury Yield were both higher with the 2-Year hitting 15-year highs intraday. The S&P 500 (SPY) fell 1.15%, the Dow Jones Industrial Average (DIA) declined 1.01%, and the NASDAQ 100 (QQQ) dropped 80 bps. August housing starts and building permits data released on Tuesday showed that building permits fell sharply on the month while residential starts rose unexpectedly. Investor confidence was shaken further by Ford plunging more than 12% on the day after issuing a warning of $1 billion in unexpected supplier costs and supply problems that have resulted in parts shortages for around 40K-45K vehicles. All U.S. factor strategies posted losses with S&P 500 High Beta (SPHB, -1.93%) seeing the largest declines. S&P 500 Pure Growth (RPG) and S&P 500 Pure Value (RPV) were lower by 1.63% and 1.55%, respectively. Developed ex-U.S. Markets (EFA) fell 1.70% on weakness in Europe while Emerging Markets (EEM) dropped just 55 bps.

Sectors: All U.S. sectors finished in the red on Tuesday with Real Estate (XLRE, -2.63%), Materials (XLB, -1.90%), and Consumer Discretionary (XLY, -1.70%) hit the hardest. Communication Services (XLC), Financials (XLF), Utilities (XLU), Industrials (XLI), and Health Care (XLV) all declined more than 1%. XLC now sits at 52-week lows while XLRE sits just 3 bps above 52-week lows and has fallen into oversold territory. All industries also posted losses with Oil & Gas Equipment & Services (XES, -3.36%) dragging Energy (XLE, -70 bps) lower and Internet (XWEB) falling another 2.94%. Just 17.86% of XWEB's holdings are currently trading above relative 50-day moving averages.

Themes: Rough day for global themes as Biotech (SBIO, +32 bps) was the only thematic segment to finish in positive territory yesterday. Cannabis (MJ) lagged, declining 4.04%, while Clean Energy (PBW), Disruptive Tech (ARKW), and Solar (TAN) all sunk more than 3%. 6 thematic segments are now trading at 52-week lows: Cannabis (MJ), Digital Infrastructure (SRVR), Space (UFO), Robotics & AI (ROBO), eSports & Video Games (ESPO), and Evolving Consumer (SOCL). All thematic segments are trading below relative 50-day moving averages and Solar (TAN) is the only segment trading above its 200-day moving average. 

Commodities & Yields: U.S. Aggregate Bonds (AGG) fell 45 bps, 20+ Year Treasury Bonds (TLT) dropped 1.00%, and the U.S. Dollar (UUP) rose 48 bps as the U.S. 10-Year Treasury Yield touched 3.600% intraday before finishing at 3.567% at the closing bell yesterday. Broad Commodities (DJP) were relatively flat as Energy (DBE) declined 96 bps and Agriculture (DBA) increased 1.32%. Wheat (WEAT) surged 6.50%, Lead (LD) plummeted 8.53%, Natural Gas (UNG) dipped 2.49%, and WTI Crude Oil (USO) sunk 1.18%.

9.20.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: U.S. markets finished higher on Monday despite continued volatility and elevated rates. The S&P 500 (SPY) and the NASDAQ 100 (QQQ) both gained 78 bps, the Dow Jones Industrial Average (DIA) added 68 bps, and the U.S. 10-Year Treasury Yield touched above 3.51% intraday, the highest levels since April 2011. The Federal Reserve is set to kickoff its two-day policy meeting on Tuesday with a 75-bps rate hike widely expected on Wednesday. According to the CME Fed Watch tool, there is a 82% chance for a 75-bps rate increase and a 18% chance for a 1% rate increase. All U.S. factor strategies posted positive returns yesterday with S&P 500 Pure Value (RPV) and S&P 500 High Beta (SPHB) both rising over 1%. Developed ex-U.S. Markets (EFA) increased 35 bps, lifted by Australia (EWA, +94 bps), and Emerging Markets (EEM) rose 32 bps as Brazil (EWZ) surged 4.23%.

Sectors: Health Care (XLV, -54 bps) and Real Estate (XLRE, -19 bps) were the only sectors to post losses yesterday. Materials (XLB) and Consumer Discretionary (XLY) climbed 1.65% and 1.41%, respectively, and outpaced other sectors. Industrials (XLI) added 87 bps while Utilities (XLU), and Financials (XLF) all gained around over 1%. Over the past week, XLF has seen nearly $2 billion in net outflows. Currently, 5 of the 11 sectors sit within 5% of relative 52-week lows: Communication Services (XLC), Consumer Staples (XLP), XLB, XLRE, and XLK.  On the industry level, Metals & Mining (XME) jumped 3.81%, Homebuilders (XHB) rose 1.80%, and Biotech (XBI) dropped 1.25%.

Themes: Mixed day for global themes on Monday led by Advanced Materials (REMX, +2.47%), Big Data (AIQ, +1.76%), and NextGen Transportation (DRIV, +1.70%). Cannabis (MJ), Water (PHO), and Cyber Security (HACK) all increased over 1%. Meanwhile, Biotech (SBIO, -1.29%), FinTech (FINX, -92 bps), Genomics (ARKG, -87 bps), and Solar (TAN, -81 bps) were the worst performing segments. All themeatic segments have seen losses over the past month and all segments have fallen more than 13.75% year-to-date except for Solar (TAN) which has risen 9.51%. The three worst perfoming thematic ETFs thus far in 2022 are all Blockchain ETFs and all three have plunged more than 70% (DAPP, BKCH, RIGZ).

Commodities & Yields: The U.S. 10-Year Treasury Yield stood at 3.494% at yesterday’s closing bell falling from intraday highs. The U.S. Dollar (UUP) fell 7 bps, U.S. Aggregate Bonds (AGG) declined 15 bps, and 20+ Year Treasury Bonds (TLT) increased 23 bps. Broad Commodities (DJP) finished up 32 bps with Wheat (WEAT) dropping 3.09%, Natural Gas (UNG) rising 1.48%, and Gasoline (UGA) adding 1.44%.

9.19.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Major averages closed out an ugly week down on Friday with the S&P 500 (SPY) falling 76 bps, NASDAQ 100 (QQQ) declining 61 bps, and the Dow Jones Industrial Average (DIA) dropping 48 bps. Small-Caps were also weak with the Russell 2000 (IWM) decreasing 1.45%. Markets were shaken by FedEx which plummeted 21.40% and withdrew its full-year guidance amid weak global shipment volumes. QQQ and SPY sunk 5.79% and 4.78%, respectively, on the week while DIA dipped 4.16%. All U.S. factor strategies finished in the red with S&P 500 Pure Value (RPV, -1.31%) and S&P 500 High Beta (SPHB, -1.23%) dropping the furthest. Last week, S&P 500 Growth (SPYG) and S&P 500 Pure Growth (RPG) both dropped more than 5% and were the worst performing factors. Emerging Markets (EEM) fell 92 bps as China (MCHI) dropped nearly 2% while Developed ex-U.S. Markets (EFA, -61 bps) were pulled lower by Germany (EWG, -1.14%).

Sectors: Consumer Staples (XLP, +24 bps) and Real Estate (XLRE, +2 bps) were the only U.S. sectors to post gains on Friday while Energy (XLE, -2.13%) and Industrials (XLI, -2.09%) underperformed. Materials (XLB) and Communication Services (XLC) were both more than 1.00% and Financials (XLF) dropped 90 bps. XLB now sits within 3% of 52-week lows. Internet (XWEB, -3.82%) and Software & Services (XES, -2.53%) dragged Technology (XLK, -56 bps) lower. Transportation (XTN) plunged 4.13% on the day following the FedEx warning. For the week, all sectors posted losses with XLB, XLI, XLC, XLRE, and XLK all declining more than 6%. Metals & Mining (XME) was the worst perfoming industry for the week plunging 10.32%. 

Themes: Global themes were battered on Friday with all thematic segments seeing losses. Genomics (ARKG) fell 5.15% while Multi-Theme (ARKK), Online Retail (IBUY), and Disruptive Tech (ARKW) all declined over 4%. Biotech (SBIO, -3.61%), Cannabis (MJ, -3.25%), and FinTech (FINX, -3.17%) also posted sizeable declines. Over the past week, ARKK has seen $177 million in net outflows and declined 4.53%. Blockchain (BLOK) and Advanced Materials (REMX) lagged other thematic segments last week decreasing 9.67% and 9.18%, respectively. 

Commodities & Yields: The U.S. 10-Year Treasury Yield was relatively flat on Friday at finished at 3.455% at the close. U.S. Aggregate Bonds (AGG) dipped 7 bps, 20+ Year Treasury Bonds (TLT) fell 83 bps, and the U.S. Dollar (UUP) was flat. Broad Commodities (DJP) declined 89 bps with Silver (SLV) rising 2.04%, Natural Gas (UNG) decreasing 5.97%, and Cotton (BAL) dropping 3.30%.

9.19.2022

An overview of the broad U.S. Size & Style ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• Despite poor performance over the past week, all Size & Style categories see net inflows; Small-caps see over $2.5 billion in net inflows
• Large-cap growth lagging MTD in September (-2.85%) for second consecutive month and for the fifth month this year
• RiverNorth Patriot ETF (FLDZ) best performing S&S ETF past month, down only 5.98%
• All Size & Style ETFs fall below their 50 day moving averages following last week's declines

9.16.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Volatility continued on Thursday as U.S. markets declined amid sustained inflationary fears and are on pace to post their fourth losing week in five. The NASDAQ 100 (QQQ) sunk 1.67%, the S&P 500 (SPY) dropped 1.14%, and the Dow Jones Industrial Average (DIA) fell 54 bps. A slew of economic reports were released yesterday with Retail Sales rising 0.3% month-over-month, the Empire State Manufacturing Index surging 30 points to -1.5 in September, the Philadelphia Fed Manufacturing Index falling sharply to -9.9, and initial jobless claims for the week ended September 10 declined 5K to 213K. After the close, FedEx withdrew full-year guidance and announced substantial cost-cutting measures following “softness” in global volume of shipments prompting concern from investors and economists. FedEx CEO Raj Subramaniam even went as far as to say that he expects the economy to enter a "worldwide recession". S&P 500 Enhanced Value (SPVU, +67 bps) was the only U.S. factor strategy to post gains while S&P 500 Growth (SPYG, -1.53%) fell the furthest. Emerging Markets (EEM) declined 1.06% on weakness from Thailand (THD, -2.15%). Developed ex-U.S. Markets (EFA) were down 88 bps as South Korea (EWY) decreased 2.09%.

Sectors: Health Care (XLV, +56 bps) and Financials (XLF, +33 bps) were the only U.S. sectors to finish higher on Thursday while Energy (XLE), Utilities (XLU), Technology (XLK), and Real Estate (XLRE) all fell more than 2%. XLK is now down 14.60% over the past month, lagging other sectors. Materials (XLB) and Industrials (XLI) were also both down over 1%. Communication Services (XLC) dipped just 43 bps and now sits at 52-week lows. On the industry level, Oil & Gas Exploration & Production (XOP, -3.53%) and Metals & Mining (XME, -2.75%) underperformed while Biotech (XBI, +1.30%), Regional Banks (KRE, +1.16%), and Banks (KBE, +1.07%) were strong.

Themes: Global themes were mixed yesterday led by Multi-Theme (ARKK, +2.19%), Genomics (ARKG, +1.70%), and Disruptive Tech (ARKW, +1.31%). Advanced Materials (REMX) plunged another 4.57% and is now down over 8% this week. Solar (TAN, -3.78%), Space (UFO, -2.03%), Wind (FAN, -2.02%), 3D Printing (PRNT, -1.97%) were also weak. Two thematic segments currently sit at 52-week lows: eSports & Video Games (ESPO) and Evolving Consumer (SOCL). The KraneShares MSCI China Clean Technology Index ETF (KGRN) was amongst the worst performing thematic ETFs on the day, falling 4.08%. KGRN has decreased over 15% in the past month and is approaching oversold territory.

Commodities & Yields: Broad Commodities (DJP) finished down 3.31% with all broad-based sectors posting losses. Energy (DBE) dropped 3.65% as Natural Gas (UNG) decreased 8.87%, Gasoline (UGA) fell 4.10%, and WTI Crude Oil (USO) declined 4.08%. The U.S. 10-Year Treasury Yield was higher and sat at 3.459% at yesterday’s close. U.S. Aggregate Bonds (AGG) dipped 30 bps, TIPS Bonds (TIP) dropped 51 bps, and the U.S. Dollar (UUP) rose 7 bps.

9.15.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: After a dismal performance on Tuesday following the Consumer Price Index results, U.S. markets rebounded on Wednesday and finished the day higher after the Producer Price Index release showed prices had declined slightly in August but remain elevated from last year's levels. The NASDAQ 100 (QQQ) added 79 bps, the S&P 500 (SPY) rose 38 bps, and the Dow Jones Industrial Average (DIA) gained 11 bps. Rates continued to rise yesterday with the 2-Year Treasury Yield touching 3.834% intraday, the highest level since 2007. Mortgage demand has also fallen 29% from last year according to the Mortgage Bankers Association index which was released Wednesday. Currently, the average 30-year fixed rate mortgage stands at 5.89%, according to Freddie Mac, versus 2.88% this time last year. U.S. factor strategies were mixed with growth-oriented pockets of markets rising steadily and outperforming value-oriented names. S&P 500 Pure Growth (RPG) increased 80 bps while S&P 500 Pure Value (RPV) declined 39 bps. Over the past 3-months, RPG has outpaced RPV by nearly 9%. Emerging Markets (EEM, +50 bps) were lifted by Indonesia (EIDO, +1.40%) and India (INDA, +1.32%) while Developed ex-U.S. Markets (EFA) climbed 33 bps as Japan (EWJ) gained 1.44%.

Sectors: Materials (XLB) and Real Estate (XLRE) underperformed other sectors on Wednesday both falling 1.22% while Energy (XLE) surged 2.82% on the heels of gains from Oil & Gas Equipment & Services (XES, +3.57%) and Oil & Gas Exploration & Production (XOP, +3.53%). Consumer Discretionary (XLY, +1.28%) and Utilities (XLU, +81 bps) also posted solid returns. Financials (XLF, -30 bps), Industrials (XLI, -21 bps), and Consumer Staples (XLP, -4 bps) were the only other sectors in the red for the day. Metals & Mining (XME, -3.06%) was the worst performing industry dragging XLB lower. Over the past week, Consumer Staples (XLP) has gathered $1.36 billion in net inflows.

Themes: Global themes were strong yesterday with Clean Energy (PBW, +2.93%), Multi-Theme (ARKK, +2.75%), and Disruptive Tech (ARKW, +2.30%) outpacing other thematic segments. Solar (TAN), Cannabis (MJ), and Genomics (ARKG) all rose over 1.50%. Digital Infrastructure (SRVR, -51 bps), Evolving Consumer (SOCL, -42 bps), and Cyber Security (HACK, -25 bps) were the only segments to post losses on the day. The ALPS Clean Energy ETF (ACES) climbed another 1.86% yesterday and inched closer to overbought territory. ACES has rocketed over 40% in the last 3 months and has risen 4.39% year-to-date. The top performing thematic ETF on the day was the ETFMG Travel Tech ETF (AWAY, +3.00%).

Commodities & Yields: U.S. Aggregate Bonds (AGG) rose 13 bps, 20+ Year Treasury Bonds (TLT) gained 34 bps, and the U.S. Dollar (UUP) decreased 20 bps. The U.S. 10-Year Treasury Yield stayed above 3.40% and finished at 3.414% at the close. Broad Commodities (DJP) jumped 1.00% as Natural Gas (UNG) surged 7.96% and WTI Crude Oil (USO) added 1.00%.

9.14.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: U.S. markets tumbled on Tuesday, snapping a 4-day winning streak after the Consumer Price Index (CPI) report showed inflation had risen 0.1% month-over-month and 8.3% year-over-year in August indicating inflation remains near 40-year highs. Rates also surged yesterday with the U.S. 2-Year Treasury Yield rising to the highest levels since 2007. The NASDAQ 100 (QQQ) plunged 5.48%, the S&P 500 (SPY) dropped 4.35%, and the Dow Jones Industrial Average (DIA) sunk 3.96%. According to the CME FedWatch Tool, there is a 66% chance of a 75-bps rate and a 34% chance of 1% rate hike by the Federal Reserve next week. After recent outperformance, growth-oriented pockets of the markets fell sharply with S&P 500 Growth (SPYG) and S&P 500 High Beta (SPHB) both declining more than 5%. All U.S. factor strategies dipped more than 2.75% except for S&P 500 Minimum Variance (SPMV) which dipped 1.22%. Developed ex-U.S. Markets (EFA) were down 3.48% as Germany (EWG), Australia (EWA) and the Netherlands (EWN) all fell over 4% while Emerging Markets (EEM, -3.08%) were dragged by South Africa (EZA, -5.10%).

Sectors: All U.S. sectors were lower by more than 2.50% yesterday with Communication Services (XLC), Technology (XLK), and Consumer Discretionary (XLY) all dropping more than 5%. XLC now sits at 52-week lows. Real Estate (XLRE), Industrials (XLI), Financials (XLF), and Materials (XLB) all declined more than 3.50%. All industries also finished down with Internet (XWEB), Homebuilders (XHB), Retail (XRT), Semiconductors (XSD), and Biotech (XBI) all plummeted over 5%. Currently, Utilities (XLU), Energy (XLE), and Consumer Discretionary (XLY) are the only sectors trading more than 10% above relative 52-week lows. 

Themes: Brutal day for global themes with all thematic segments posting losses. Disruptive Tech (ARKW, -7.01%) was the worst perfoming segment while Blockchain (BLOK), Multi-Theme (ARKK), Online Retail (IBUY), and Cannabis (MJ) all dropped more than 6%. For ARKK, all of its 34 holdings finished in the red with 7 holdings (8.88% weight) falling more than 10% yesterday. Cloud Computing (SKYY), Genomics (ARKG), and Casinos & Gaming (BETZ) all fell over 5%. Two Blockchain ETFs, the Global X Blockchain ETF (BKCH) and the Bitwise Crypto Industry Innovators ETF (BITQ), declined 9.71% and 9.30% respectively on the day. Over the past month, BKCH and BITQ are both down nearly 25%. 

Commodities & Yields: The U.S. 10-Year Treasury Yield shot up above 3.40% and sat at 3.425% at Tuesday’s closing bell. The U.S. Dollar (UUP) jumped 1.38%, U.S. Aggregate Bonds (AGG) dipped 15 bps, and TIPS Bonds (TIP) dropped 30 bps. Broad Commodities (DJP) declined 67 bps as all broad-based sectors were in the red. Gold (GLD) fell 1.30%, Copper (JJC) decreased 2.49%, and WTI Crude Oil (USO) declined 50 bps.

9.13.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: For the fourth consecutive session, major averages finished higher ahead of the Tuesday release of the Consumer Price Index report, a key inflationary measure. There has been speculation that inflation may have peaked, boosting investor confidence. The NASDAQ 100 (QQQ) and the S&P 500 (SPY) climbed 1.19% and 1.07%, respectively, while the Dow Jones Industrial Average (DIA) gained 71 bps. Small-Caps also saw healthy returns with the Russell 2000 (IWM) adding 1.21%. U.S. factors were strong with all strategies closing in positive territory. S&P 500 Dividend (SPYD, +1.33%), S&P 500 Growth (SPYG, +1.25%), and S&P 500 High Beta (SPHB, +1.14%) outperformed. Emerging Markets (EEM) increased 1.49% on strength from Mexico (EWW, +2.34%) and South Africa (EZA, +2.24%) while Developed ex-U.S. Markets (EFA, +1.39%) benefitted from gains from Germany (EWG, +2.81%) and France (EWQ, +2.08%).

Sectors: All U.S. sectors posted positive returns on Monday led by Energy (XLE) which added another 1.84%. Technology (XLK) and Consumer Discretionary (XLY) both rose over 1% on the day while Utilities (XLU) and Materials (XLB) were both up over 90 bps. XLU now sits at 52-week highs and is approaching overbought territory. Year-to-date, XLU has risen 10.72%, the only sector besides XLE to post gains thus far in 2022. Communication Services (XLC) added 52 bps and is now trading 5.33% above 52-week lows. Internet (XWEB, +2.57%) was the top performing industry on the day, providing a boost for XLK. Metals & Mining (XME) was the only industry to see losses, falling just 6 bps.

Themes: A sea of green for global thematic segments yesterday with the exception of Advanced Materials (REMX) which declined 25 bps. Online Retails (IBUY, +2.78%), Disruptive Tech (ARKW, +2.61%), and Cloud Computing (SKYY, +2.51%) were the best performing segments. Multi-Theme (ARKK) and Genomics (ARKG) were also up over 2% on the day. Four thematic segments sit more than 60% below 52-week highs: Disruptive Tech (ARKW), Blockchain (BLOK), Multi-Theme (ARKK) and Cannabis (MJ). Several Clean Energy ETFs are approaching overbought territory amid recent outperformance (ACES, EVX, QCLN, CNRG, ICLN, CTEC). Over the past 3-month period, the ALPS Clean Energy ETF (ACES) has surged nearly 29%.

Commodities & Yields: Broad Commodities (DJP) increased another 2.21% on Monday on the heels of steady gains from Natural Gas (UNG, +4.02%), WTI Crude Oil (USO, +1.79%), Nickel (JJN, +5.31%), and Silver (SLV, +4.91%). U.S. Aggregate Bonds (AGG) dipped 15 bps, 20+ Year Treasury Bonds (TLT) dropped 82 bps, and the U.S. Dollar (UUP) fell 51 bps. The U.S. 10-Year Treasury Yield rose yesterday and stood at 3.358% at the closing bell.

9.12.2022

An overview of the broad U.S. Size & Style ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• Large-cap growth saw $1.2 billion in net outflows over the past week while small-cap growth saw $418 million in net outflows
• Mid-cap growth, mid-cap, and large-cap growth have all risen over 3% on average thus far in September
• Large-cap growth is still down over 21% YTD while small-cap growth is down over 19%
• The Avantis U.S. Large Cap Value ETF (ALVL) has outpaced other size & style ETFs over the past month climbing just 2.23%

9.12.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: On Friday, U.S. markets surged ahead of the Federal Reserve meeting on September 20-21 which is widely expected to include a 75-bps interest rate hike by the central bank. Major averages also finished up for the week following Friday's gains.The NASDAQ 100 (QQQ) climbed 2.19% on Friday and was up 4.04% for the week, the S&P 500 (SPY) rose 1.55% and gained 3.66% for the week, and the Dow Jones Industrial Average (DIA) added 1.27% on Friday and increased 2.72% for the week. Small-Caps were also strong on Friday with the Russell 2000 (IWM) jumping 2.01%. All U.S. factors saw positive returns on Friday once again led by growth-oriented pockets of the markets. S&P 500 High Beta (SPHB) gained another 2.16% on the day and finished the week up 6.34% while S&P 500 Pure Growth (RPG) climbed 1.66% on Friday and rose 5.64% for the week. Developed ex-U.S. Markets (EFA) shot up 2.55% on Friday benefitting from solid gains from the Netherlands (EWN, +3.22%) and Australia (EWA, +3.19%) while Emerging Markets (EEM, +1.48%) were lifted by South Africa (EZA, +3.33%) and Brazil (EWZ, +3.25%). Investors will be looking towards the Consumer Price Index, Producer Price Index, and Retail Sales reports this week.

Sectors: All U.S. sectors were in the green on Friday with Communication Services (XLC, +2.79%) and Energy (XLE, +2.49%) outperforming. XLE pushed higher by Oil & Gas Equipment & Services (XES, +5.16%). Technology (XLK) and Consumer Discretionary (XLY) rose 1.98% and 1.90%, respectively, while Materials (XLB) and Industrials (XLI) both increased over 1% as well. Utilities (XLU, +40 bps) was the worst performing sector and now sits within 1% of new 52-week highs. On the industry level, Internet (XWEB, +4.38%) and Metals & Mining (XME, +3.80%) were strong. Last week, all sectors posted gains with Consumer Discretionary (XLY) and Materials (XLB) both rising over 5%. Internet (XWEB) outpaced other industries on the week surging 7.57%.

Themes: Global themes saw strong returns on Friday with all segments finishing higher and most segments gaining over 2%. Disruptive Tech (ARKW) jumped 5.09% on the day and was the top performing segment. Blockchain (BLOK), Multi-Theme (ARKK), and Online Retail (IBUY) were all up over 4% while Cloud Computing (SKYY) and Cannabis (MJ) both rose over 3.50%. Two Blockchain ETFs, the Global X Blockchain ETF (BKCH) and the Bitwise Crypto Industry Innovators ETF (BITQ), both surged over 7% on Friday and outpaced other thematic ETFs. All thematic segments gained over 2% last week. Advanced Materials (REMX) rocketed 11.95% on the week and handily outgained other segments. 

Commodities & Yields: The U.S. 10-Year Treasury Yield was relatively flat on Friday and closed at 3.319%. The U.S. Dollar (UUP) dropped 71 bps, U.S. Aggregate Bonds (AGG) were down 1 bps, and 20+ Year Treasury Bonds (TLT) increased 22 bps. Broad Commodities (DJP) finished Friday up 2.12% as WTI Crude Oil (USO) added 4.42%, Gasoline (UGA) rose 4.40%, and Nickel (JJN) increased 5.20%.

9.9.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: In a volatile Thursday session, U.S. markets finished higher after Jerome Powell reiterated the Fed’s stance on lowering inflation stating that a pause in rate hikes or a shift to cutting interest rates is not coming soon. The S&P 500 (SPY) added 65 bps, the Dow Jones Industrial Average (DIA) gained 60 bps, and the NASDAQ 100 (QQQ) rose 52 bps. Growth-oriented pockets of the markets were strong again with S&P 500 Pure Growth (RPG, +1.81%) and S&P 500 High Beta (SPHB, +1.64%) outpacing other U.S. factor strategies yesterday. All factors ended the day in the green. Year-to-date, S&P 500 Pure Value (RPV) is still outperforming RPG by over 20%. Emerging Markets (EEM) dipped 54 bps as China (MCHI) dropped 1.29%. Developed ex-U.S. Markets (EFA) were relatively flat as European markets digested the 75 bps rate increase by the European Central Bank. Germany (EWG) dropped 1.18%, France (EWQ) declined 64 bps, and the U.K. (EWU) was down just 7 bps. The European Union energy ministers will also hold an emergency meeting on Friday to address soaring European energy prices amid the cutoff of natural gas supply by Russia.

Sectors: U.S. sectors were mixed yesterday with Consumer Staples (XLP, -26 bps), Communication Services (XLC, -24 bps), and Utilities (XLU, -8 bps) finishing in negative territory. XLC has been the worst performing sector in 2022 falling 30.00%. Financials (XLF) and Health Care (XLV) climbed 1.76% and 1.74%, respectively, and outperformed other sectors. Materials (XLB) and Consumer Discretionary (XLY) were both up over 90 bps. XLF benefitted from Banks (KBE) and Regional Banks (KRE) which both jumped over 2%. Biotech (XBI, +3.10%) was the top performing industry once again and has climbed nearly 20% over the past 3-month period. Despite recent outperformance, XBI still sits 34.83% below 52-week highs. 

Themes: Another solid day for global themes on Thursday with only three segments in the red: Space (UFO, -1.30%), Evolving Consumer (EVOL, -50 bps), and Casinos & Gaming (BETZ, -13 bps). Genomics (ARKG) and Blockchain (BLOK) were the top performing sectors both rising over 3%. Multi-Theme (ARKK, +2.97%) and Disruptive Tech (ARKW, +2.58%) followed while Advanced Materials (REMX) and Biotech (SBIO) both gained over 2%. OVer the past month, ARKK has declined nearly 16% and seen $783 million in net outflows. Just 20.59% of ARKK's holdings are currently trading above relative 50-day moving averages. The KraneShares CSI China Internet ETF (KWEB) lagged other thematic ETFs yesterday dropping 2.22%. KWEB has also seen $732 million in net outflows over the past month.

Commodities & Yields: The U.S. 10-Year Treasury Yield increased moderately and stood at 3.311% at Thursday’s close. U.S. Aggregate Bonds (AGG) sunk 32 bps, 20+ Year Treasury Bonds (TLT) dropped 1.03%, and the U.S. Dollar (UUP) increased 20 bps. Broad Commodities (DJP) added 85 bps on the day, lifted by Industrial Metals (DBB, +1.79%). Natural Gas (UNG) rose 1.93%, Gasoline (UGA) increased 76 bps, and Copper (JJC) gained 2.99%.

9.8.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Major averages rebounded on Wednesday as growth-oriented pockets of the markets caught a bid. Rates also slumped after rising steadily on Tuesday and the Fed’s Beige Book report showed that economic activity was little changed in many parts of the country. The NASDAQ 100 (QQQ) climbed 2.02%, the S&P 500 (SPY) rose 1.80%, and the Dow Jones Industrial Average (DIA) added 1.32%. Mid-Caps (IJH) and the Russell 2000 (IWM) both gained over 2% as well. All U.S. factor strategies posted gains led by S&P 500 High Beta (SPHB, +2.93%) and S&P 500 Pure Growth (RPG, +2.44%). S&P 500 Pure Value (RPV) also rose 1.59%. Developed ex-U.S. Markets (EFA, +88 bps) benefitted from gains from Germany (EWG, +2.56%) and France (EWQ, +2.10%) while Emerging Markets (EEM, +89 bps) were lifted by India (INDA, +1.63%). Investors will be monitoring Jerome Powell’s speech on Thursday along with Jobless Claims data.

Sectors: Energy (XLE, -1.16%) was the only U.S. sector to see losses on Wednesday as it was dragged lower by a decrease in WTI Crude Oil prices and declines from Oil & Gas Exploration & Production (XOP, -1.82%) and Oil & Gas Equipment & Services (XES, -1.27%). Utilities (XLU) and Consumer Discretionary (XLY) both surged over 3% and outpaced other sectors. XLU is trading well above its 50-day and 200-day moving averages. All other sectors gained over 1.50% with Materials (XLB, +2.77%), Communication Services (XLC, +2.01%), Financials (XLF, +1.98%), and Real Estate (XLRE, +1.92%) posting solid returns. XLF has seen nearly $1 billion in net outflows over the past week. Healthcare Equipment (XHE) and Biotech (XBI) were the top performing industries on the day, both rising over 4%.

Themes: Excellent day yesterday for global themes with all segments in the green. Solar (TAN) continued its outperformance, surging 6.16% while Genomics (ARKG) and Clean Energy (PBW) both shot up over 4.50%. Solar (TAN) is now trading nearly 20% above its 200-day moving average and is the only thematic segment currently trading above relative 50-day and 200-day moving averages. Smart Infrastructure (GRID), Multi-Theme (ARKK), Disruptive Tech (ARKW), Biotech (SBIO), and Wind (FAN) were all up over 3%. eSports & Video Games (ESPO) and Industrial Revolution (ARKQ) were the only segments not to climb over 1% on Wednesday. Only two thematic ETFs finished the day in negative territory: the AdvisorShares Pure US Cannabis ETF (MSOS, -40 bps) and the ETFMG U.S. Alternative Harvest ETF (MJUS, -40 bps). 

Commodities & Yields: Broad Commodities (DJP) sunk 1.55% with all broad-based sectors seeing declines. Energy (DBE) dipped 3.99% as Gasoline (UGA) fell 4.70%, WTI Crude Oil (USO) dropped 5.32%, and Natural Gas (UNG) decreased 2.84%. The U.S. 10-Year Treasury Yield declined yesterday and stood at 3.271% at the closing bell. The U.S. Dollar (UUP) fell 71 bps while U.S. Aggregate Bonds (AGG) rose 69 bps and 20+ Year Treasury Bonds (TLT) increased 1.58%.

9.7.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: U.S. markets declined on Tuesday as yields surged and investors continued to speculate on the next move of the Federal Reserve’s rate tightening policy ahead of the September meeting. The NASDAQ 100 (QQQ) dropped 72 bps, the Dow Jones Industrial Average (DIA) fell 50 bps, and the S&P 500 (SPY) dipped 38 bps as the U.S. 10-Year Treasury Yield surged above 3.30%. Small-Caps (IJR) were weak, losing 1.29% on the day. Investors also digested stronger-than-expected ISM Services Index data. According to the CME FedWatch Tool, there is a 72% chance of a 75-bps rate increase by the Fed later this month. All U.S. factor strategies saw losses for the second straight session with S&P 500 Pure Value (RPV, -67 bps) and S&P 500 High Dividend (SPHD, -66 bps) underperforming. Emerging Markets (EEM, -1.19%) were pulled lower by Brazil (EWZ, -2.01%) and China (MCHI, -1.93%) while Developed ex-U.S. Markets (EFA) were down just 25 bps. Currently, EEM and EFA aboth sit at 52-week lows.

Sectors: U.S. sectors were mixed yesterday led by Real Estate (XLRE) which jumped 1.04%. Utilities (XLU, +25 bps), Industrials (XLI, +16 bps), and Health Care (XLV, +10 bps) were the only other sectors to finish higher on Tuesday. XLU continues to close in on new 52-week highs and currently sits just 3.79% below those levels. Communication Services (XLC, -1.24%) was the worst performing sector followed by Energy (XLE, -93 bps), Technology (XLK, -66 bps), and Consumer Staples (XLP, -56 bps). XLK is nearing oversold territory and has fallen more than 10% in the past month. On the industry level, Metals & Mining (XME, +71 bps) was the top performer while Biotech (XBI, -2.85%) trailed. 

Themes: The majority of thematic segments posted losses on Tuesday with Cannabis (MJ, -3.71%), Biotech (SBIO, -2.86%), Blockchain (BLOK, -2.22%), and Evolving Consumer (SOCL, -2.05%) falling the furthest. Genomics (ARKG) and Disruptive Tech (ARKW) fell more than 1.50% while Robotics & AI (AIQ) dipped 1.49% on the day. Advanced Materials (REMX) surged 2.44% and handily outpaced other segments. Solar (TAN, +1.87%), Space (UFO, +44 bps), Water (PHO, +22 bps), Clean Energy (PBW, +17 bps), and Industrial Revolution (ARKQ, +2 bps) were the only other segments in the green. Year-to-date, Solar (TAN) is the only segment to post positive returns, gaining 6.99%. Meanwhile, 4 segments have slumped more than 50% in the period: Cannabis (MJ), Blockchain (BLOK), Multi-Theme (ARKK), and Disruptive Tech (ARKW)

Commodities & Yields: U.S. Aggregate Bonds (AGG) decreased 94 bps, 20+ Year Treasury Bonds (TLT) dropped 2.48%, and the U.S. Dollar (UUP) added 58 bps as the U.S. 10-Year Treasury Yield surged, standing at 3.342% at yesterday’s closing bell. Broad Commodities (DJP) finished lower by 1.92%, dragged by Energy (DBE, -89 bps). Natural Gas (UNG) plummeted 9.48% and Gasoline (UGA) fell 1.12%. Year-to-date, UNG is still up over 122%. 

9.5.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: On Friday, major averages retreated after a brief rally on Thursday despite another strong nonfarm payrolls report which showed the U.S. economy added 315K jobs in August. Investors remain wary of another aggressive rate hike by the Federal Reserve, likely 75 bps,  at the September meeting. The NASDAQ 100 (QQQ) declined 1.41% while the S&P 500 (SPY) and the Dow Jones Industrial Average (DIA) dropped 1.05% and 1.04%, respectively. Last week, all three major averages posted losses for the third consecutive week with QQQ down 3.99%, SPY lower by 3.22%, and DIA down 2.84%. All U.S. factor strategies were in negative territory on Friday with S&P 500 Growth (SPYG) and S&P 500 Low Volatility (SPLV) both falling more than 1%. Emerging Markets (EEM) dipped 92 bps on weakness from China (MCHI, -1.83%) and Developed ex-U.S. Markets (EFA) dropped 66 bps as South Korea (EWY), Japan (EWJ), and Hong Kong (EWH) all declined more than 1%.

Sectors: Energy (XLE) surged another 1.83% on Friday and was the only U.S. sector to see positive returns. Communication Services (XLC, -1.90%) and Real Estate (XLRE, -1.71%) lagged other sectors while Health Care (XLV), Consumer Staples (XLP), Technology (XLK), and Utilities (XLU) all declined over 1%. XLC currently sits within 1.50% of 52-week lows and nearly 36% below 52-week highs. On the industry level, Oil & Gas Equipment & Services (XES, +5.06%) and Oil & Gas Exploration & Production (XOP, +2.36%) outperformed. Last week, all U.S. sectors were in the red with XLK and Matierlas (XLB) falling the furthest. Over the last month, XLE and XLU are the only sectors to post positive returns.

Themes: Another weak day for global themes as 3D Printing (PRNT, +79 bps) and Advanced Materials (REMX, +13 bps) were the only segments to finish higher on Friday. Genomics (ARKG, -2.94%), Multi-Theme (ARKK, -2.71%), Solar (TAN, -2.36%), and Digital Infrastructure (SRVR, -2.32%) all underperformed. SRVR entered oversold territory. Industrial Revolution (ARKQ) and Clean Energy (PBW) were both down over 1.75%. Just 5 thematic ETFs were in the green on the day.  Last week, all thematic segments saw losses with Clean Energy (PBW, -7.20%) falling the furthest. 

Commodities & Yields: The U.S. 10-Year Treasury Yield dipped on Friday and stood at 3.197% at the close. The U.S. Dollar (UUP) was relatively flat, U.S. Aggregate Bonds (AGG) rose 29 bps, and TIPS Bonds (TIP) increased 59 bps. Broad Commodities (DJP) finished the day up just 3 bps as Lead (LD) fell 4.31%, Gold (GLD) added 88 bps, Gasoline (UGA) gained 3.25%, and Natural Gas (UNG) decreased 3.25%.

9.2.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: After four consecutive sessions of losses, U.S. markets finished higher on the first day of September ahead of a key jobs report on Friday. The Dow Jones Industrial Average (DIA) rose 45 bps, the S&P 500 (SPY) added 31 bps, and the NASDAQ 100 (QQQ) increased 4 bps. Growth-oriented pockets of the markets were shaken by the 2-Year Treasury Yield rising to the highest levels since November 2007 and Nvidia sinking more than 7% amid news that the U.S. government was restricting certain chip sales in China. S&P 500 High Beta (SPHB) and S&P 500 Pure Growth (RPG) sunk 54 bps and 37 bps, respectively. S&P 500 Low Volatility (SPLV, +90 bps) and S&P 500 Value (SPYV, +34 bps) were the top performing U.S. factors on the day. Developed ex-U.S. Markets (EFA) declined 1.35% on weakness from the Netherlands (EWN, -2.42%) and South Korea (EWY, -2.12%) while Emerging Markets (EEM, -79 bps) were pulled lower by Taiwan (EWT, -1.55%).

Sectors: Energy (XLE) dropped 2.46% on Thursday, dragged by Oil & Gas Exploration & Production (XOP, -3.89%) and Oil & Gas Equipment & Services (XES, -3.85%). Materials (XLB) dipped 1.31% as Metals & Mining (XME) fell 3.79%. Technology (XLK, -49 bps) was the only other U.S. sector in the red as Semiconductors (XSD) and Internet (XWEB) both declined more than 2.75%. Health Care (XLV, +1.64%) and Utilities (XLU, +1.44%) outperformed while Communication Services (XLC, +92 bps) and Consumer Discretionary (XLY, +91 bps) also posted solid returns. XLC currently sits just 3.39% above 52-week lows. Biotech (XBI) was the best performing industry yesterday rising 2.17%. Over the past month, XBI has risen 7.61%.

Themes: Biotech (SBIO, +1.95%), Genomics (ARKG, +65 bps), and Water (PHO, +24 bps) were the only thematic segments to post gains on Thursday as most segments fell more than 2%. Advanced Materials (REMX) dropped 4.01% and was the worst performing segment while Clean Energy (PBW), Cannabis (MJ), Cyber Security (HACK), and Cloud Computing (SKYY) all fell over 3%. Just 8 thematic ETFs were in the green yesterday with 6 of those being Health Innovation ETFs (SBIO, GNOM, IDNA, BTEC, ARKG, GDOC). 9 thematic ETFs currently sit at 52-week lows including 3 Cannabis ETFs (THCX, MJ, TOKE) and 2 eSports & Video Games ETFs (GAMR, HERO).

Commodities & Yields: U.S. Aggregate Bonds (AGG) decreased 43 bps, 20+ Year Treasury Bonds (TLT) sunk 1.83%, and the U.S. Dollar (UUP) increased 89 bps as the U.S. 10-Year Treasury Yield shot up above 3.25% and finished at 3.267% at yesterday’s closing bell. Broad Commodities (DJP) dropped 2.05% as all broad-based sectors declined. Industrial Metals (DBB) decreased 3.79%, Wheat (WEAT) sunk 4.45%, WTI Crude Oil (USO) declined 2.95%, and Gasoline (UGA) finished lower by 2.19%.

9.1.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Major averages dropped for the fourth consecutive day on investor concerns of higher interest rates to come from the Fed. The drop closes out August on a down note after a recent summer rally. The current Fed base rate is set between 2.25% and 2.50%, but according to the CME FedWatch Tool the Fed base rate is expected to finish the year between 3.75% and 4.00%, 150 basis points higher. Meanwhile with short-term rates jumping the 10-year/2-year yield spread has now been inverted since early July, a historically predictive indicator of recession. The S&P 500 (SPY) dropped 0.76%, the NASDAQ 100 (QQQ) fell by 0.58%, and the Dow Jones Industrial Average (DIA) declined 0.75%. The Russell 2000 (IWM) fell by 0.61% while US growth (RPG -0.67%) outperformed US value (RPV -0.92%).

Sectors: All 10 of 11 U.S. sectors declined on Tuesday with Communication Services (XLC +0.24%) leading the way while Materials (XLB -1.23%) lagging. From an industry perspective, Oil & Gas Exploration and Production  led (XOP +1.01%) followed by Biotech (XBI +0.72%). Laggards included Retail (XRT -1.78%) and Transportation (XTN -1.57%).

Themes: ForGlobal themes were mixed as major averages fell for their fourth day in a row. Themes were led by social media (SOCL +2.06%), Clean Energy (PBW +1.41%), and Genomics (ARKG +1.31%) while Cyber Security (HACK -1.12%) lagged. The ProShares Pet Care ETF (PAWZ) is officially the second thematic ETF to enter oversold territory this week after its 14-Day RSI level fell below 30. Several others are nearing this territory including several water ETFS (EBLU, PIO, CGW).

Commodities & Yields: The rise in yields had fixed income ETFs down on Wednesday with the US Aggregate (AGG) finishing 53 basis points lower. Long-dated Treasuries (TLT -0.96%) lagged while 1-3 Year Treasuries (SHY) fell 1 basis point. The U.S. Dollar (UUP) fell 7 basis points while broad commodities (DJP -1.31%) were lower on declines in energy (DBE -3.16%) and agriculture (DBA -0.34%).

8.31.2022

An overview of the Global Thematic ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• Sustainability leads in net inflows among thematic segments for the second consecutive week; now has $411 million in  net inflows over past three months
• ARK Innovation ETF (ARKK) leads in net inflows among thematic ETFs over the past week (again) with $176 million
• All thematic segments down in month of August; Evolving Consumer leads (-0.69%) while FinTech lags (-3.95%)
• The AdvisorShares Psychedelics ETF (PSIL) leads in performance among thematic ETFs over past month, up 28.80% 

8.31.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Major averages moved lower on Tuesday for the third consecutive day as the summer rally loses steam in the face of more expected rate hikes coming from the Federal Reserve. Following Fed Chair Jerome Powell’s comments on Friday that markets should expect elevated interest rate levels for ‘some time,’ the New York Fed President John Williams re-upped that rhetoric on Tuesday by stating that he believes real interest rates need to rise above zero. The S&P 500 (SPY) dropped 1.10%, the NASDAQ 100 (QQQ) fell by 1.11%, and the Dow Jones Industrial Average (DIA) declined 0.95%. The Russell 2000 (IWM) fell by 1.40% while international names did not fare well either. Emerging markets (EEM -1.18%) underperformed developed ex-US (EFA -0.72%).

Sectors: All 11 U.S. sectors declined on Tuesday with Energy (XLE -3.39%) lagging and Financials (XLF -0.54%) and Health Care (XLV -0.66%) leading. Energy has led over the past month (XLE +3.60%) and over the past year is up 74%. There is a 110% difference in performance between Energy and Tech (XLK) duringt his time period. That being said, over the past month we have seen over $750 million in net inflows for the tech sector (XLK) whereas Energy (XLE) has seen $89 million in net outflows.

Themes: For a third consecutive day global themes had a rough day in terms of performance as the risk-off trade continued. All sub-groups were down with only two thematic ETFs making gains; the Global X Cybersecurity ETF (BUG +0.62%) and the WisdomTree Cloud Computing Fund (WCLD +0.13%).  Meanwhile the wild ride for Cannabis ETFs continued as they gave up all of their gains from Monday. The Global X Cannabis ETF (POTX) was the biggest laggard, down 5.49%. We are seeing several thematic ETFs get closer to oversold conditions with one officially in it as of the close on Tuesday: the KraneShares MSCI China Clean Technology Index ETF (KGRN). 

Commodities & Yields: Fixed income ETFs were mixed on Tuesday as short-term rates continued moving higher and we saw some flattening in the curve. The broad U.S. Aggregate rose (AGG -0.48%) along with long-dated Treasuries (TLT +0.25%) while 1-3 Year Treasuries (SHY) fell 5 basis points. The U.S. Dollar (UUP) fell 3 basis points while broad commodities (DJP -1.98%) were dragged down by energy (DBE -3.18%).

8.31.2022

Private sector employment increased by 132,000 jobs in August and annual pay was up 7.6%

• The 132K increase in private payroll jobs was well below consensus estimates of +225K
• Payroll increases were seen across all company sizes
• Largest increases were in the Leisure & Hospitality (+96K) and Trade, Transportation, & Utilities (+53K)
• U.S. Private Employment appears to be slowing dramatically
• ADP Report Press Release

8.30.2022

Breakdown of the previous day's market action through the lens of ETFs:

Equities: Friday's collapse in equity markets continued into Monday sending all major averages lower. The recent sell-off has been the result of Fed Chair Jerome Powell indicating that the Fed will continue to raise rates to kill inflation and that elevated rates will persist for some time. Since the chair's Jackson Hole speech on Friday, the probability of a 75 basis point hike at the September Fed meeting has jumped to 70.5% according to the CME Group FedWatch Tool. The S&P 500 (SPY) dropped 0.66% on Monday, the NASDAQ 100 (QQQ) fell by 0.99%, and the Dow Jones Industrial Average (DIA) declined 0.57%. Value names (RPV -0.19%) provided a bit more shelter than growth (RPG -1.02%) while emerging markets (EEM -0.62%)underperformed developed ex-US (EFA -0.22%).

Sectors: Only two of 11 US sectors were able to finish higher to start the week yesterday. Energy (XLE +1.51%) led followed by utilities (XLU +0.30%) while tech lagged again (XLK -1.32%).  The tech sector is now over 21% below its 52-week high and is getting closer to oversold conditions after recent declines. In fact, Health Care (XLV), Communication Services (XLC), and Tech all currently have 14-day RSI levels in the 30's (below 30 is considered oversold).

Themes: Monday was another day of weak performance for global themes. Cannabis was the top performer with several pot ETFs closing up over 1% (MJUS, MSOS, YOLO,MJ,POTX). Genomics (ARKG) was the lagging sub-group on Monday, falling 2.41%.  Over the past week, we are still seeing net inflows for the thematic category with nearly $300 million flowing into multi-theme ETFs. Sustainability follows with $63 million in net inflows while Evolving Consumer has seen $18 million in net inflows.

Commodities & Yields: Fixed income ETFs moved lower on Monday (AGG -0.48%) with the increase in yields. The U.S. Dollar (UUP) increased three basis points while broad commodities (DJP) increased 0.32%. Crude oil (USO +3.74%) helped push energy commodities higher (DBE +2.10%) while agriculture (DBA) rose a modest 0.14%).

8.30.2022

An overview of the U.S. Factor ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• Total US Factor ETF assets under management back above 2021 levels (slightly)
• Over the past year both Momentum/Growth and Value factor strategies have seen net outflows
• Recent sell-off has all US factors down in the month of August; Value leading (-0.55%) while Quality factor lags (-2.35%)
• Alpha Architect U.S. Quantitative Momentum ETF (QMOM +6.64%) best performing US factor ETF over past month

8.30.2022

U.S. home prices up nearly 20% year/year in June but have decelerated from the previous month

• S&P CoreLogic HPI 20-city index (SA) were up 0.4% month/month, below consensus estimates of 1.1%
• National annual price gains of 18.0%; down from 19.9% in the previous month
• Tampa, Miami, and Dallas reported the highest year-over-year gains 
• As the Fed ratchets up interest rates and the cost of a mortgage increases we have seen recent cooling from the red hot housing market; more cooling likely to come
• Homebuilder ETFs: ITB, XHB, HOMZ, NAIL

8.29.2022

An overview of the U.S. Sector ETF landscape - Performance, Flows, Valuations, Earnings, & Technicals.

• More net inflows for Financial sector ETFs; Financial Select Sector SPDR Fund (XLF) brings in over $2.1 billion in net inflows over past week
• Energy best performing sector in August, up 6.58%. Real Estate lagging (down 3.36%)
• Credit Suisse S&P MLP Index ETN (MLPO) best performing sector ETF over past month, up 32%
• Majority of sectors currently trading between their 50 and 200 day moving averages which could provide levels of support and resistance