Wall Street performed decently last week with the S&P 500, the Dow Jones and the Nasdaq Composite adding about 2.5%, 3.8% and 2.5%, respectively. This happened despite stimulus talks breaking down on Capitol Hill. Decent jobs and manufacturing data as well as vaccine hopes have probably kept investors’ confidence alive.
However, on Aug 8, President Donald Trump sidestepped the nation's lawmakers as
he imposed on the authority to defer payroll taxes and swap an expired unemployment benefit with a lower amount after negotiations with Congress on a new virus bill failed.
Against this backdrop, below we highlight the winning leveraged ETFs of last week.
ProShares Ultra Bloomberg Natural Gas ( BOIL Quick Quote BOIL - Free Report) ) – Up 51.5%
Natural gas price surged last week on hot weather forecast. Warmer-than-normal temperatures are expected in most of the Midwest and east coast in the near term, and this has propelled natural gas demand for air conditioning. Meanwhile, industrial energy demand is also showing signs of increasing as global economies are emerging from coronavirus-imposed lockdowns (read:
Natural Gas ETFs Surge on Hot Weather Outlook). ProShares Ultra Silver ( AGQ Quick Quote AGQ - Free Report) – Up 31.4%
Silver has been on a stellar ride with prices climbing to the highest level in nearly seven years. An increase in investment demand, pickup in industrial activity due to factory reopening after lockdowns, and investors’ appetite for alternatives to the safe-haven asset gold (which is pretty pricey at the current level) led to the rally. Silver has a considerable presence in the industrial sector. About 50% of the metal’s total demand comes from industrial applications. So, the reopening of global economies is helping silver more than the yellow metal (read:
Silver ETFs or Gold: Which Metal to Shine More Ahead?). ProShares UltraPro Russell2000 ( URTY Quick Quote URTY - Free Report) – Up 18.8%
U.S. small-cap stocks put up a decent show last week. Small-cap ETF
IWM added 4.3% probably on undervaluation, some upbeat economic data points like jobs data, the likelihood of more government stimulus injection, low rates and vaccine hopes. Another leveraged small-cap ETF Direxion Daily Small Cap Bull 3x Shares (TNA) also added 18.5% in the week. Direxion Daily Retail Bull 3X Shares ( RETL Quick Quote RETL - Free Report) ) – Up 22.5%
Some upbeat economic indicators like jobs and manufacturing data, vaccine hopes and the likelihood of U.S. virus stimulus have probably fueled investors’ optimism in the retail ETF.
Direxion Daily Transportation Bull 3X Shares ( TPOR Quick Quote TPOR - Free Report) – Up 18.5%
The Dow Jones Transportation Average spurted to
a five-month high last week as COVID curve flattened across the Southern and Southwestern states. Package delivery services company United Parcel Service, Inc. (UPS) jumped to an all-time high. Travelling has also increased materially with TSA checkpoint travel numbers reporting more than 700,000 travellers on several days in the past one month, which is way higher than the minimum of 87534 recorded in mid-April. Direxion Daily Aerospace & Defense Bull 3X Shares ( DFEN Quick Quote DFEN - Free Report) – Up 18.1%
The space has soared higher probably on a few upbeat earnings. Raytheon Technologies, General Dynamics and Northrop Grumman beat on earnings while Boeing missed it. Since Boeing’s pain is known to all (due to its 737max crisis), decent Q2 numbers from other players probably instilled optimism among investors.
Direxion Daily Regional Banks Bull 3X Shares ( DPST Quick Quote DPST - Free Report) – Up 16.3%
The space probably has gained last week on a slight rise in treasury yields (following an upbeat jobs number) and undervaluation of the banking sector. Benchmark treasury yields jumped to 0.57% on Aug 7 from 0.56% from the start of the week.
Direxion Daily Pharmaceutical & Medical Bull 3X Shares ( PILL Quick Quote PILL - Free Report) – Up 15.3%
Vaccine and treatment hopes for COVID-19 are the key winning factors of the pharma space right now. Moderna is pursuing the final stage trial and has also priced its coronavirus vaccine. The U.S. government has announced last week that it will pay Johnson & Johnson over $1 billion for 100 million doses of its potential coronavirus vaccine. There are several other players which are coming up with vaccine news occasionally.
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