Scalper1 News
After a rocky Q3, the fourth quarter started off on a decent note, with the first month of the quarter – October – stepping up on gas. The U.S. markets were in green, thanks to a delayed Fed lift-off possibility at the end of September, no more economic shockers from China (the root cause of the Q3 massacre of the global market) and solid tech earnings. U.S. stocks delivered the largest monthly returns in four years. Among the top ETFs, investors saw the S&P 500-based SPY gain about 8.5%, Dow Jones-based DIA advance 8.6% and Nasdaq-based QQQ have a stellar rally and pop about 11.4% in October. While QQQ surged from superb tech earnings, DIA got positive cues from the oil price recovery, though for a shorter period. Though the bullish sentiments eased later in the month on the return of Fed-related worries, moderate corporate earnings and hopes for further policy easing across the globe (especially by the ECB) maintained the upbeat momentum. That being said, below we highlight the best and worst ETF performers of October (returns are mentioned as per xtf.com ). Global X MSCI Argentina ETF (NYSEARCA: ARGT ) – Up 25.1% Argentina stocks were a surprise winner in October on election euphoria. The election on October 25 did not however succeed in bringing out a victor and led to a runoff. In fact, Conservative opposition’s pro-business candidate Mauricio Macri’s unexpected strength in the poll box set the stage for a second round on November 22 . Hopes of a pro-growth leader and the ongoing election-related spending fueled Argentina’s stocks and the related ETF. KraneShares CSI China Internet ETF (NASDAQ: KWEB ) – Up 20.7% Overall, the Chinese stocks are back with a bang after the horrendous sell-off in the August-September period, on compelling valuation and the government accommodative policies. Of the whole set, the Chinese Internet stocks deserve a special mention as these are soaring on solid earnings. Be it Alibaba Group (NYSE: BABA ) or Baidu (NASDAQ: BIDU ), most stocks witnessed jump in its share prices post earnings release and helped KWEB gain over 20% in the month. Several other China-based ETFs including Guggenheim China Technology ETF (NYSEARCA: CQQQ ), PowerShares Golden Dragon China Portfolio (NYSEARCA: PGJ ), and KraneShares CSI China Five Year Plan ETF (NYSEARCA: KFYP ) returned over 19% in the month. Global X Copper Miners ETF (NYSEARCA: COPX ) – Up 19.0% Copper prices held up well in October on the possibility of an easing supply glut, fresh Chinese rate cuts as well as Beijing’s pro-growth reforms. Announcements by Freeport-McMoRan (NYSE: FCX ) and Glencore ( OTCPK:GLNCY ), the second and third largest copper producing companies worldwide, for considerable output cuts, boosted the price of the red metal. Moreover, China matters the most for this metal as the country is the world’s biggest consumer of this industrial metal, making up roughly 40% of global copper demand. All these tailwinds lifted the copper mining stocks and ETFs in October. Notably, mining ETFs generally trade as a leveraged play on the underlying metal and thus see a higher jump. C-Tracks on Citi Volatility Index ETN (NYSEARCA: CVOL ) – Down 45.2% Volatility products lost the most in October, as these tend to underperform when markets are rising or fear levels over the future are low, both of which were the flavors of October, though the trends began to alter at end the month. The Fed-induced bounce was behind the volatility crash in October. As such, CVOL linked to the Citi Volatility Index Total Return, plunged about 45% last month. iPath Dow Jones-UBS Natural Gas ETN (NYSEARCA: GAZ ) – Down 25.8% Natural gas prices fell through the floor in October on higher inventory and the buzz that this winter might be milder than the prior two. El Niño, a warm-water phenomenon that blows off the Pacific coast of South America, is likely to be stronger and keep the Northern Hemisphere relatively warmer. As almost 50% of Americans use natural gas for heating purposes, these fundamentals dented the pricing of the commodity. As a result, the product shed about 25.8%. iShares Currency Hedged MSCI ACWI ETF (NYSEARCA: HACW ) – Down 8.3% Since the U.S. dollar dipped early in October, the currency-hedging technique fell out of investor favor. As a result, this ETF lost about 8% in the month. However, investors should note that with the Fed rate hike talks on the table again, and China, Euro zone and Japan mulling over further policy easing, the flair for currency hedging is brightening up. Original Post Scalper1 News
Scalper1 News