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The month of April has been upbeat for Wall Street with the S&P 500 (up 4.8%), the Dow Jones (up 2.7%), the Nasdaq Composite (up 4.5%) and the small-cap Russell 2000 (up 1.84%) – all remaining in the green. In fact, the S&P 500 and the Dow Jones have been hovering near all-time highs. Upbeat earnings, especially the technology ones, even upbeat U.S. economic growth for the first quarter of 2021 and other data points like retail sales have driven the markets lately.
Agreed, markets skidded a bit occasionally on fear of President Biden’s capital gain tax hike. Talks are rife that Biden is now likely to propose a plan to raise taxes on the richest Americans, including the largest-ever increase in levies on investment gains. This would be to finance about $1 trillion in social spending that serve childcare, universal pre-kindergarten education and paid leave for workers, per sources (read: What Holds for ETFs If Biden Hikes Capital Gain Tax?).
The new marginal 39.6% rate would be a substantial increase from the current rate of 20%, for those earning $1 million or more. This on top of an existing surtax on investment income, will lead federal tax rates for wealthy investors to as high as 43.4%, per a Bloomberg article. If applied, this would be the highest tax rate on capital gains since the 1920s. The rate has not surpassed 33.8% in the post-World War Two era, as quoted on a Reuters article.
There have been upbeat vaccine updates from Novavax in the month while JNJ vaccine’s safety concerns suddenly gave a push to some stay-at-home stocks. On the flip side, coronavirus cases have been rising in several corners of the world.
Against this backdrop, below we highlight a few ETF areas for the month of April.
Shipping
Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) , which added 42.3% in the month, seeks to provide investors with exposure to the daily change in the price of dry bulk freight futures. It added 4.6% last week. The pickup in global economic growth has supported the dry bulk shipping rates. Gradually rising demand across all vessel categories has mainly aided the area and the related fund (read: Top-Performing ETFs of March).
Agricultural Commodities
Agricultural commodities surged thanks to weather-related supply concerns and higher demand that has encouraged investment fund buying. Corn futures jumped to their highest since 2013, wheat climbed to a seven-year high, while soybeans hit an eight-year high.
A subdued U.S. dollar, which tends to make U.S. grains more competitive on the export market, also helped the rally. Additionally, strong demand from the livestock sector boosted China’s imports of soybeans, as well as grains like corn and wheat (read: Why Agricultural Commodity ETFs Are Soaring This Year).
Internet and COVID-themed stocks surged in April due to another wave of COVID-19 in several parts of the world, which in turn caused further lockdowns. This has favored the stay-at-home industry as lockdowns boosted demand for online shopping and other kinds of Internet activities. No wonder, cloud and cyber security ETFSimplify Volt Cloud and Cybersecurity Disruption is up 17.3%.
Palladium
Palladium has been seeing strong demand in the manufacture of industrial products. The metal is used for catalytic converters in gasoline-powered cars. Meanwhile, the markets have been long grappling with the supply crunch of palladium. Physical Palladium ETF (PALL - Free Report) is up 17.1%.
Copper Mining
Copper prices have been on an uptrend for quite some time and is currently trading at a 10-year high level. The rally looks to be more protracting as supply crunch in top producer Chile has been boosting the price. A notable improvement in global demand is also in the cards. Plus, a global push for green investments is also benefiting the demand for copper. Global X Copper Miners ETF (COPX - Free Report) is up 15.7% in the month (read: Copper at 10-Year High: Are ETFs Headed for Further Rally?).
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5 ETF Areas of April Up At Least 15%
The month of April has been upbeat for Wall Street with the S&P 500 (up 4.8%), the Dow Jones (up 2.7%), the Nasdaq Composite (up 4.5%) and the small-cap Russell 2000 (up 1.84%) – all remaining in the green. In fact, the S&P 500 and the Dow Jones have been hovering near all-time highs. Upbeat earnings, especially the technology ones, even upbeat U.S. economic growth for the first quarter of 2021 and other data points like retail sales have driven the markets lately.
Agreed, markets skidded a bit occasionally on fear of President Biden’s capital gain tax hike. Talks are rife that Biden is now likely to propose a plan to raise taxes on the richest Americans, including the largest-ever increase in levies on investment gains. This would be to finance about $1 trillion in social spending that serve childcare, universal pre-kindergarten education and paid leave for workers, per sources (read: What Holds for ETFs If Biden Hikes Capital Gain Tax?).
The new marginal 39.6% rate would be a substantial increase from the current rate of 20%, for those earning $1 million or more. This on top of an existing surtax on investment income, will lead federal tax rates for wealthy investors to as high as 43.4%, per a Bloomberg article. If applied, this would be the highest tax rate on capital gains since the 1920s. The rate has not surpassed 33.8% in the post-World War Two era, as quoted on a Reuters article.
There have been upbeat vaccine updates from Novavax in the month while JNJ vaccine’s safety concerns suddenly gave a push to some stay-at-home stocks. On the flip side, coronavirus cases have been rising in several corners of the world.
Against this backdrop, below we highlight a few ETF areas for the month of April.
Shipping
Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) , which added 42.3% in the month, seeks to provide investors with exposure to the daily change in the price of dry bulk freight futures. It added 4.6% last week. The pickup in global economic growth has supported the dry bulk shipping rates. Gradually rising demand across all vessel categories has mainly aided the area and the related fund (read: Top-Performing ETFs of March).
Agricultural Commodities
Agricultural commodities surged thanks to weather-related supply concerns and higher demand that has encouraged investment fund buying. Corn futures jumped to their highest since 2013, wheat climbed to a seven-year high, while soybeans hit an eight-year high.
A subdued U.S. dollar, which tends to make U.S. grains more competitive on the export market, also helped the rally. Additionally, strong demand from the livestock sector boosted China’s imports of soybeans, as well as grains like corn and wheat (read: Why Agricultural Commodity ETFs Are Soaring This Year).
Teucrium Corn (CORN - Free Report) – Up 19.9%
Teucrium Wheat (WEAT - Free Report) – Up 18.7%
Technology
Internet and COVID-themed stocks surged in April due to another wave of COVID-19 in several parts of the world, which in turn caused further lockdowns. This has favored the stay-at-home industry as lockdowns boosted demand for online shopping and other kinds of Internet activities. No wonder, cloud and cyber security ETFSimplify Volt Cloud and Cybersecurity Disruption is up 17.3%.
Palladium
Palladium has been seeing strong demand in the manufacture of industrial products. The metal is used for catalytic converters in gasoline-powered cars. Meanwhile, the markets have been long grappling with the supply crunch of palladium. Physical Palladium ETF (PALL - Free Report) is up 17.1%.
Copper Mining
Copper prices have been on an uptrend for quite some time and is currently trading at a 10-year high level. The rally looks to be more protracting as supply crunch in top producer Chile has been boosting the price. A notable improvement in global demand is also in the cards. Plus, a global push for green investments is also benefiting the demand for copper. Global X Copper Miners ETF (COPX - Free Report) is up 15.7% in the month (read: Copper at 10-Year High: Are ETFs Headed for Further Rally?).
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>