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Wall Street was upbeat last week, with the S&P 500, the Dow Jones and the Nasdaq gaining 2.6%, 2% and 3.3%, respectively. Better-than-feared corporate earnings, upbeat retail sales for the month of June and investors’ beliefs that markets have reached a bottom led to this upsurge.
All three major averages are above their 50-day moving averages for the first time since April. The S&P 500, the Dow Jones and the Nasdaq have added about 7.1%, 6.5% and 8.5%, respectively, past month. The broader market index increased about 7% last week from its Jun 16 closing low.
Retail sales in the United States jumped 1% sequentially in June 2022, beating forecasts of a 0.8% gain, and rebounding from a downwardly revised 0.1% decline in May. Sales at gasoline stations recorded the biggest increase (3.6%), followed by sales at non-store retailers (2.2%); miscellaneous store retailers (1.4%); furniture stores (1.4%); food services and drinking places (1%); motor vehicle and parts dealers (0.8%); and sporting goods, hobby, musical and book stores (0.8%) (read: ETFs & Stocks to Win on Uptick in June Retail Sales).
Per the Earnings Trends issued on Jul 20, 2022, for the 60 S&P 500 companies that have reported Q2 results, total earnings are down 11% from the year-earlier period on 6.6% higher revenues, with 73.3% beating EPS estimates and 63.3% beating revenue estimates.
The struggle from the Finance sector accounts for most of the earnings decline, with the year-over-year growth pace improving to 12% for the companies that have reported when the Finance sector is excluded from the numbers.
Against this backdrop, below we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
Ultra Bloomberg Natural Gas ETF (BOIL - Free Report) – Up 34%
The ProShares Ultra Bloomberg Natural Gas seeks daily investment results, before fees and expenses, that correspond to two times (2X) the daily performance of the Bloomberg Natural Gas Subindex.
The underlying Bloomberg Natural Gas Subindex is intended to reflect the natural gas segment of the commodities market. The index consists of futures contracts on natural gas. The fund charges 95 bps in fees.
The Direxion Daily Consumer Discretionary Bull 3X Shares seek daily investment results, before fees and expenses, of 300% of the performance of the Consumer Discretionary Select Sector Index, which includes domestic companies from the consumer discretionary sector. The fund charges 97 bps in fees.
S&P 500 High Beta Bull 3X Direxion (HIBL - Free Report) – Up 18.2%
The Direxion Daily S&P 500 High Beta Bull 3X Shares seek daily investment results, before fees and expenses, of 300% of the performance of the S&P 500 High Beta Index. The underlying S&P 500 High Beta Index selects 100 securities from the S&P 500 Index that have the highest sensitivity to beta over the past 12 months. The fund charges 97 bps in fees.
The MicroSectors FANG & Innovation 3x Leveraged ETN are linked to three times leveraged participation in the performance of the Solactive FANG Innovation Index, compounded daily, minus the applicable fees. The Solactive FANG Innovation Index tracks the stock prices of 15 large capitalization U.S. technology stocks. The fund charges 95 bps in fees.
The Direxion Daily Homebuilders & Supplies Bull 3X Shares seeks daily investment results, before fees and expenses, of 300% of the performance of the Dow Jones U.S. Select Home Construction Index. The Dow Jones U.S. Select Home Construction Index measures U.S companies in the home construction sector that provide a wide range of products and services related to homebuilding. The fund charges 96 bps in fees.
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Best Inverse/Leveraged ETFs of Last Week
Wall Street was upbeat last week, with the S&P 500, the Dow Jones and the Nasdaq gaining 2.6%, 2% and 3.3%, respectively. Better-than-feared corporate earnings, upbeat retail sales for the month of June and investors’ beliefs that markets have reached a bottom led to this upsurge.
All three major averages are above their 50-day moving averages for the first time since April. The S&P 500, the Dow Jones and the Nasdaq have added about 7.1%, 6.5% and 8.5%, respectively, past month. The broader market index increased about 7% last week from its Jun 16 closing low.
Retail sales in the United States jumped 1% sequentially in June 2022, beating forecasts of a 0.8% gain, and rebounding from a downwardly revised 0.1% decline in May. Sales at gasoline stations recorded the biggest increase (3.6%), followed by sales at non-store retailers (2.2%); miscellaneous store retailers (1.4%); furniture stores (1.4%); food services and drinking places (1%); motor vehicle and parts dealers (0.8%); and sporting goods, hobby, musical and book stores (0.8%) (read: ETFs & Stocks to Win on Uptick in June Retail Sales).
Per the Earnings Trends issued on Jul 20, 2022, for the 60 S&P 500 companies that have reported Q2 results, total earnings are down 11% from the year-earlier period on 6.6% higher revenues, with 73.3% beating EPS estimates and 63.3% beating revenue estimates.
The struggle from the Finance sector accounts for most of the earnings decline, with the year-over-year growth pace improving to 12% for the companies that have reported when the Finance sector is excluded from the numbers.
Meanwhile, natural gas prices have been rallying. Natural-gas futures jumped 48% this month. The continental heatwave is projected to prolong into August, which in turn would likely boost natural gas prices further.
Against this backdrop, below we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
Ultra Bloomberg Natural Gas ETF (BOIL - Free Report) – Up 34%
The ProShares Ultra Bloomberg Natural Gas seeks daily investment results, before fees and expenses, that correspond to two times (2X) the daily performance of the Bloomberg Natural Gas Subindex.
The underlying Bloomberg Natural Gas Subindex is intended to reflect the natural gas segment of the commodities market. The index consists of futures contracts on natural gas. The fund charges 95 bps in fees.
Consumer Discretionary Bull 3X Direxion (WANT - Free Report) – Up 21.3%
The Direxion Daily Consumer Discretionary Bull 3X Shares seek daily investment results, before fees and expenses, of 300% of the performance of the Consumer Discretionary Select Sector Index, which includes domestic companies from the consumer discretionary sector. The fund charges 97 bps in fees.
S&P 500 High Beta Bull 3X Direxion (HIBL - Free Report) – Up 18.2%
The Direxion Daily S&P 500 High Beta Bull 3X Shares seek daily investment results, before fees and expenses, of 300% of the performance of the S&P 500 High Beta Index. The underlying S&P 500 High Beta Index selects 100 securities from the S&P 500 Index that have the highest sensitivity to beta over the past 12 months. The fund charges 97 bps in fees.
Microsectors Fang & Innovation 3X ETN (BULZ - Free Report) – Up 17.8%
The MicroSectors FANG & Innovation 3x Leveraged ETN are linked to three times leveraged participation in the performance of the Solactive FANG Innovation Index, compounded daily, minus the applicable fees. The Solactive FANG Innovation Index tracks the stock prices of 15 large capitalization U.S. technology stocks. The fund charges 95 bps in fees.
Homebuilders & Suppliers Bull 3X Direxion (NAIL - Free Report) – Up 17.5%
The Direxion Daily Homebuilders & Supplies Bull 3X Shares seeks daily investment results, before fees and expenses, of 300% of the performance of the Dow Jones U.S. Select Home Construction Index. The Dow Jones U.S. Select Home Construction Index measures U.S companies in the home construction sector that provide a wide range of products and services related to homebuilding. The fund charges 96 bps in fees.