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4 ETFs Up At Least 7% Amid Last Week's Market Slump

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The bloodbath that started in Wall Street on Nov 26 on news of the Omicron variant of the COVID-19 stretched last week also. We saw some positive days last week (as the S&P 500 logged its best day in seven weeks), overall, it was downbeat for Wall Street.The S&P 500 (down 1.2%), the Dow Jones (down 0.9%), the Nasdaq Composite (down 0.9%) and the Russell 2000 (down 3.9%) were all in the red on a weekly basis (read: S&P 500 Notches Best Day in Seven Weeks: 5 ETF Winners).

Apart from the Omicron woes, inflationary pressure continued to bother markets. The Fed also indicated that it will speed up QE tapering in the coming days probably to rein in inflation. Powell said that he sees the unwinding to conclude “a few months” sooner than expected, a move that might lead to faster-than-expected interest rate hikes.

 As far the key economic data are concerned, the manufacturing sector recorded growth while the jobs data came in downbeat. Nonfarm payrolls increased by 210,000 in November, following a gain of 546,000 the previous month. The number fell shy of Wall Street expectations of 573,000, per CNBC.

Against this backdrop, below we highlight a few ETFs those were up at least 7% last week.

ETFs in Focus

Breakwave Dry Bulk Shipping ETF (BDRY - Free Report) – Up 19.7%

The underlying Capesize 5TC Index, Panamax 4TC Index and Supramax 6TC Index measure rates for shipping dry bulk freight. Breakwave Dry Bulk Shipping ETF’s expense ratio is 3.47%.

The ongoing supply chain issues have kept the demand for shipping at pretty high levels, leading to higher freight rates. The rate for a single shipping container has shot up materially over the last 18 months as the pandemic disrupted supply chains and trade channels.      

The Short De-Spac ETF (SOGU - Free Report) – Up 14.9%

This ETF is active and does not track a benchmark. The Short De-SPAC ETF is an actively managed exchange traded fund that attempts to achieve the inverse of the return of the De-SPAC Index.

There was a rise of Black Check or Special Purchase Acquisition Company (SPAC) from 2020 as the Blank Check route for going public proved to be less complicated and pricey in the COVID scenario. However, the boom has started fading lately. Instead, the fundamentals behind inverse SPAC ETF look good.

“Post-merger companies are particularly attractive to short because they have larger market capitalizations, making their shares easier to borrow, and because early investors in the SPACs are eager to sell shares to lock in profits, analysts and fund managers said,” according to a Wall Street Journal article released in March 2021.

The above logic indicates that the inverse SPAC ETF has every reason to have a good time. Plus, the latest Wall Street crash led all SPAC boom doubters to bet against SPAC deals.  

Global X MSCI Colombia ETF (GXG - Free Report) – Up 8.3%

The underlying MSCI All Colombia Select 25/50 Index is designed to represent the performance of the Broad Colombian Equity Universe, while including constituents with a minimum level of liquidity and applying the MSCI 25/50 Indexes methodology.

The Colombian, Chilean and Peruvian stock exchanges have approved to merge into a regional holding company, forming Latin America's second biggest bourse. The holding company, whose approval by each country's regulator is pending, would be based in Chile, the exchanges said in a joint statement, per Reuters.

South Africa iShares MSCI ETF (EZA - Free Report) – Up 7.9%

The buy-the-dip strategy boosted the South African market. The Omicron strain was first found in South Africa, which led to a crash in the country’s bourse. South Africa's currency rand plunged to its lowest since October 2020 on Omicron news.

Now, with the variant spreading around the globe slowly and causing no massive scare to date, investors seem to have digested the Omicron news and opted for the buy-the-dip strategy.