November has been a good month for the U.S. stock market. Fresh hopes of smaller interest rate hikes, following an easing in consumer prices, have rekindled investors’ risk-on trading. However, the re-emergence of recessionary fears after renewed COVID-19 outbreaks in China and a weakening global growth outlook continued to weigh on sentiments.
While there have been winners in many corners of the space, we highlight five ETFs from different industries that outperformed in November. The funds are Credit Suisse S&P MLP ETN ( MLPO Quick Quote MLPO - Free Report) , Sprott Junior Gold Miners ETF ( SGDJ Quick Quote SGDJ - Free Report) , Global X Copper Miners ETF ( COPX Quick Quote COPX - Free Report) , VanEck Vectors Steel ETF ( SLX Quick Quote SLX - Free Report) , and Global X Social Media Index ETF ( SOCL Quick Quote SOCL - Free Report) . These are likely to continue outperforming should the trends prevail. Here's How Markets Fared in November
Annual inflation slipped below 8% for the first time in eight months. The consumer price index rose 7.7% annually in October, after rising 8.2% at the end of September, while the core consumer price index, which strips out volatile components such as food and energy prices, climbed 6.3% year over year, down from 6.6% in September. The data renewed optimism in the stock market about the Fed‘s possibility of slowing its pace of interest-rate increases in 2023. The latest Fed minutes from the November meeting confirmed that the officials expect to switch to smaller interest rate increases soon.
Additionally, the holiday season started with a huge bang despite concerns about inflation and higher prices. Consumers spent a record $9.12 billion, up 2.3% year over year, on online shopping during Black Friday this year, according to Adobe. Holiday spending is expected to be healthy despite inflationary challenges, with retail sales likely to grow 6-8% from the 2021 level during November and December to $942.6-$960.4 billion, per the National Retail Federation. Holiday online sales are forecast to increase 10-12% to $262.8-$267.6 billion, up from $238.9 billion in 2021 (read: 6 Hot ETF Deals for Cyber Monday). However, U.S. stocks have been weighed down by the protests in mainland China against the country’s zero-Covid policy that started over the weekend. The protests elevated concerns over the potential of China’s Covid protocols that could once again hamper global supply chains. Credit Suisse S&P MLP ETN ( MLPO Quick Quote MLPO - Free Report) – Up 186% Amid volatility in the stock market, this overlooked corner is making great strides. MLPs have relatively consistent cash flows, making them less risky than the other plays in the broader energy space. These represent an attractive investment option for income-focused investors as MLPs pay out substantially all their income to investors on a regular basis. In addition to high yields and the potential for capital appreciation, MLPs also have lower volatility and provide diversification benefits to the portfolio. Credit Suisse S&P MLP ETN is linked to the S&P MLP Index, which includes both master limited partnerships and publicly traded limited liability companies having a similar legal structure to MLPs and sharing the same tax benefits. It is unpopular and illiquid in the MLP space, with AUM of $29.7 million and an average daily volume of nearly 2,000 shares. The note charges 95 bps in annual fees (read: Top-Performing ETFs of Thanksgiving Week). Sprott Junior Gold Miners ETF ( SGDJ Quick Quote SGDJ - Free Report) – Up 20.4% Signs of cooling inflation, which has sparked hopes that the Fed might slow down the pace of its interest-rate increases, drive gold prices higher. Gold is highly sensitive to rising U.S. interest rates as these increase the opportunity cost of holding non-yielding bullion. Sprott Junior Gold Miners ETF follows the Solactive Junior Gold Miners Custom Factors Index, which measures the performance of junior gold producers with the strongest revenue growth and junior exploration companies with the strongest stock price momentum. It holds 43 stocks in its basket, with Canadian firms making up the largest share at 42.5%, followed by Australia (41.5%) and Turkey (7.7%). Sprott Junior Gold Miners ETF has amassed $103.9 million in its asset base and trades in a lower volume of around 19,000 shares a day. It charges 50 bps in annual fees from investors. Global X Copper Miners ETF ( COPX Quick Quote COPX - Free Report) – Up 19.6% Copper prices rose amid China's supportive measures for its property sector and a weaker U.S. dollar. Global X Copper Miners ETF offers global access to a broad range of copper mining companies. It tracks the Solactive Global Copper Miners Total Return Index and holds 40 stocks in its basket. Canadian firms take the largest share at 32.9%, while Australia and the United States round off the next two spots. Global X Copper Miners ETF has managed $1.6 billion in its asset base while charging 65 bps in fees per year. It trades in a good volume of 461,000 shares a day on average. VanEck Vectors Steel ETF ( SLX Quick Quote SLX - Free Report) – Up 16.2% VanEck Vectors Steel ETF provides a pure-play exposure to a small basket of 26 stocks in the steel sector. It tracks the NYSE Arca Steel Index. American firms dominate the fund’s returns at 49%, followed by Brazil (19.4%) and Australia (10.7%). VanEck Vectors Steel ETF has amassed $98.4 million in its asset base and charges 55 bps in fees from investors. It trades in a moderate volume of 24,000 shares a day on average. Global X Social Media Index ETF ( SOCL Quick Quote SOCL - Free Report) – Up 15.4% Global X Social Media Index ETF provides investors access to social media companies around the world and has amassed $117.4 million in its asset base. It tracks the Solactive Social Media Total Return Index, holding 42 securities in the basket (read: Should You Go Bottom Fishing Big Tech ETFs Following Soros?). Global X Social Media Index ETF charges 0.65% in annual fees and sees lower trading volumes of roughly 19,000 shares a day. The fund has a Zacks ETF Rank #1 (Strong Buy) with a High-risk outlook.