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Last week was upbeat for Wall Street, with the S&P 500 and Nasdaq recording their best weekly advancement since July, rising about 3.7% and 4.6%, respectively. The Dow gained 3.3%, recording its best gain since August.
The week was largely dominated by stimulus talks. Even afterpostponing the stimulus talks until after the election, U.S. President Donald Trump sought some aid approvals from Congress. Among the most-necessary ones, Trump wants an extension in the $25 billion of new payroll assistance to U.S. passenger airlines, furloughing thousands of workers amid dropping travel demand.
Moreover, Trump wanted Congress to approve a stand-alone bill that would allow a second round of $1,200 checks. Both the Democrats and the Republicans have shown support for such aids, though it is still not clear if these proposals could be passed before the election.
On Friday afternoon, Trump said that he wants to “see a bigger stimulus package, frankly, than either the Democrats or Republicans are offering,” during Rush Limbaugh’s radio show, as quoted on Yahoo Finance.
There are reports that earlier on the day, White House planned to offer a stimulus proposal totaling $1.8 trillion, which is $400 billion short of the plan House Democrats voted to advance last week. This, however, would still mark an increase from the $1.6 trillion Treasury Secretary Steven Mnuchin had proposed.
Investors’ sentiments were upbeat last week on anticipation of some stimulus sooner or later. Against this backdrop, we highlight the winning leveraged ETF areas. Returns are as per etfdb.com.
Direxion Daily Pharmaceutical & Medical Bull 3X Shares (PILL - Free Report) ) – Up 30%
The gene-editing space has been dominating the headlines since the announcement of the 2020 Nobel Prize winners for Chemistry. The prestigious award has been won by Jennifer Doudna, PhD, and Emmanuelle Charpentier, PhD, who are considered pioneers in the development of CRISPR (Clustered Regularly Interspaced Short Palindromic Repeats) technology as a “genetic scissors.” Following the news, major gene-editing stocks soared. Apart from this piece of news, COVID-19 vaccine trials have kept the space hot in recent times (read: Genomics ETFs Surge on Nobel Prize for Gene-Editing Pioneers).
The space is buzzing with mergers and acquisitions. Chip producer Xilinx added 17% on Oct 9 on talks that Advanced Micro Devices (AMD) may buy the former for more than $30 billion. In September, the chip industry benefited from Nvidia’s acquisition news of Arm Limited for $40 billion. A better-than-expected monthly sales report from Taiwan Semiconductor Manufacturing(TSM)also boosted the space last week.
Stimulus hopes and Fed minutes made the yield curve steeper, with the gap between 5- and 30-year yields rising as high as 126 basis points on Oct 7. This is near the 2020 high reached in June, when the yield curve was the steepest since 2016. The 10-year breakeven rate of consumer price inflation — a market-based measure of average inflation rates over the next decade — is around 1.70%, having gained in the past few sessions. No wonder, reflation trade would set in and yield curve would steepen. As regional banks fare well in a steepening yield curve environment, DPST gained last week (read: Bank ETFs Surge as Yield Curve Steepens).
Direxion Daily Small Cap Bull 3X Shares (TNA - Free Report) ) – Up 20.0%
Renewed hopes for stimulus boosted small-cap stocks last week. Stimulus checks and funds for a second round of small business loans should provide assistance to small-cap companies. The segment is likely to benefit no matter who wins the election as Trump supports the “America First” agenda while Biden endorses “Buy American.” This, in turn, would benefit small-cap ETFs as these are heavily dependent on domestic companies (read: Trump or Biden, Small-Cap Stocks & ETFs to Gain).
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Top-Performing Leveraged ETFs of Last Week
Last week was upbeat for Wall Street, with the S&P 500 and Nasdaq recording their best weekly advancement since July, rising about 3.7% and 4.6%, respectively. The Dow gained 3.3%, recording its best gain since August.
The week was largely dominated by stimulus talks. Even afterpostponing the stimulus talks until after the election, U.S. President Donald Trump sought some aid approvals from Congress. Among the most-necessary ones, Trump wants an extension in the $25 billion of new payroll assistance to U.S. passenger airlines, furloughing thousands of workers amid dropping travel demand.
Moreover, Trump wanted Congress to approve a stand-alone bill that would allow a second round of $1,200 checks. Both the Democrats and the Republicans have shown support for such aids, though it is still not clear if these proposals could be passed before the election.
On Friday afternoon, Trump said that he wants to “see a bigger stimulus package, frankly, than either the Democrats or Republicans are offering,” during Rush Limbaugh’s radio show, as quoted on Yahoo Finance.
There are reports that earlier on the day, White House planned to offer a stimulus proposal totaling $1.8 trillion, which is $400 billion short of the plan House Democrats voted to advance last week. This, however, would still mark an increase from the $1.6 trillion Treasury Secretary Steven Mnuchin had proposed.
Investors’ sentiments were upbeat last week on anticipation of some stimulus sooner or later. Against this backdrop, we highlight the winning leveraged ETF areas. Returns are as per etfdb.com.
Direxion Daily Pharmaceutical & Medical Bull 3X Shares (PILL - Free Report) ) – Up 30%
The gene-editing space has been dominating the headlines since the announcement of the 2020 Nobel Prize winners for Chemistry. The prestigious award has been won by Jennifer Doudna, PhD, and Emmanuelle Charpentier, PhD, who are considered pioneers in the development of CRISPR (Clustered Regularly Interspaced Short Palindromic Repeats) technology as a “genetic scissors.” Following the news, major gene-editing stocks soared. Apart from this piece of news, COVID-19 vaccine trials have kept the space hot in recent times (read: Genomics ETFs Surge on Nobel Prize for Gene-Editing Pioneers).
Direxion Daily Semiconductor Bull 3x Shares (SOXL - Free Report) ) – Up 24.58%
The space is buzzing with mergers and acquisitions. Chip producer Xilinx added 17% on Oct 9 on talks that Advanced Micro Devices (AMD) may buy the former for more than $30 billion. In September, the chip industry benefited from Nvidia’s acquisition news of Arm Limited for $40 billion. A better-than-expected monthly sales report from Taiwan Semiconductor Manufacturing(TSM)also boosted the space last week.
Direxion Daily Regional Banks Bull 3X Shares (DPST - Free Report) ) – Up 22.7%
Stimulus hopes and Fed minutes made the yield curve steeper, with the gap between 5- and 30-year yields rising as high as 126 basis points on Oct 7. This is near the 2020 high reached in June, when the yield curve was the steepest since 2016. The 10-year breakeven rate of consumer price inflation — a market-based measure of average inflation rates over the next decade — is around 1.70%, having gained in the past few sessions. No wonder, reflation trade would set in and yield curve would steepen. As regional banks fare well in a steepening yield curve environment, DPST gained last week (read: Bank ETFs Surge as Yield Curve Steepens).
Direxion Daily Small Cap Bull 3X Shares (TNA - Free Report) ) – Up 20.0%
Renewed hopes for stimulus boosted small-cap stocks last week. Stimulus checks and funds for a second round of small business loans should provide assistance to small-cap companies. The segment is likely to benefit no matter who wins the election as Trump supports the “America First” agenda while Biden endorses “Buy American.” This, in turn, would benefit small-cap ETFs as these are heavily dependent on domestic companies (read: Trump or Biden, Small-Cap Stocks & ETFs to Gain).
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 >>