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Wall Street was mixed last week due to tepid earnings and moderate interest rate backdrop. The S&P 500, the Dow Jones and the Russell 2000 lost about 0.7%, 2.7% and 1%, respectively last week. However, the tech-heavy Nasdaq Composite was 0.6%.
As far as the benchmark U.S. treasury yield is concerned, the week started at 3.49% (hit a weekly high and low of 3.53% and 3.37%, respectively) and ended at 3.48%. Growth stocks staged a comeback on chances of lower bond yields.
The yields occasionally fell because U.S. producer prices dropped in December by the maximum since the start of the pandemic, continuing a months-long cooling in inflationary pressures and giving the Federal Reserve a leeway to slow the pace of interest-rate hikes.
Retail sales, too, came in soft. Sales in the United States fell 1.1% sequentially in December 2022, following an upwardly revised 1% decline in November and worse than forecasts of a 0.8% fall. Year-over-year, retail sales grew 9.2% (read: ETFs & Stocks to Win Despite a Soft December Retail Sales).
However, banking earnings were not satisfactory. The fourth quarter earnings season for the S&P 500 is not off to a great start. To date, the number and magnitude of positive earnings surprises reported by S&P 500 companies are below their 5-year and 10-year averages, per FactSet.
Against this backdrop, below we highlight a few top-performing ETF areas that gained the most last week.
Bitcoin surged last week amid optimism that it may have bottomed. Talks that inflation has peaked and will exhibit a downtrend in 2023 are doing rounds. This has bolstered risk-on trade sentiments and favored the beaten-down asset cryptocurrency.
The Borsa Istanbul 100 index traded around 5440 in the second half of January, close to record high levels of last year, as investors kept using equities as a hedge against high inflation and a weak lira, and Turkish residents sought assets to store their savings, per tradingeconomics. The central bank of Turkey held its interest rate fixed at 9% for a second time in January, signifying the end of its rate-cutting cycle.
Clean Energy
KraneShares European Carbon Allowance Strategy ETF (KEUA - Free Report) – Up 6.9%
The underlying IHS Markit Carbon EUA Index tracks the most traded EUA futures contracts. Corporations and countries alike have recently joined in a climate initiative to shift to a decarbonized economy, helped by governments and demand from environmentally conscious consumers.
In addition to investing in renewable energies and carbon capture technologies, some companies use carbon offsets. Another way for companies to manage their carbon footprint is to buy and sell emission allowances. In the cap-and-trade system, a government sets a limit on overall emissions, which is tightened over time. Big carbon emitters need to buy these pollution permits to stay under regularity caps.
Internet
Ark Next Generation Internet ETF (ARKW - Free Report) – Up 5.5%
As rates dived occasionally last week, growth stocks gained. Internet stocks were heavily beaten-down last year but bucked the losing trend to start 2023 as these perform better in a low-rate environment.
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Top-Performing ETFs of Last Week
Wall Street was mixed last week due to tepid earnings and moderate interest rate backdrop. The S&P 500, the Dow Jones and the Russell 2000 lost about 0.7%, 2.7% and 1%, respectively last week. However, the tech-heavy Nasdaq Composite was 0.6%.
As far as the benchmark U.S. treasury yield is concerned, the week started at 3.49% (hit a weekly high and low of 3.53% and 3.37%, respectively) and ended at 3.48%. Growth stocks staged a comeback on chances of lower bond yields.
The yields occasionally fell because U.S. producer prices dropped in December by the maximum since the start of the pandemic, continuing a months-long cooling in inflationary pressures and giving the Federal Reserve a leeway to slow the pace of interest-rate hikes.
Retail sales, too, came in soft. Sales in the United States fell 1.1% sequentially in December 2022, following an upwardly revised 1% decline in November and worse than forecasts of a 0.8% fall. Year-over-year, retail sales grew 9.2% (read: ETFs & Stocks to Win Despite a Soft December Retail Sales).
However, banking earnings were not satisfactory. The fourth quarter earnings season for the S&P 500 is not off to a great start. To date, the number and magnitude of positive earnings surprises reported by S&P 500 companies are below their 5-year and 10-year averages, per FactSet.
Against this backdrop, below we highlight a few top-performing ETF areas that gained the most last week.
Cryptocurrency
ProShares Bitcoin Strategy ETF (BITO - Free Report) – Up 14.7%
VanEck Bitcoin Strategy ETF – Up 14.5%
Bitcoin surged last week amid optimism that it may have bottomed. Talks that inflation has peaked and will exhibit a downtrend in 2023 are doing rounds. This has bolstered risk-on trade sentiments and favored the beaten-down asset cryptocurrency.
Turkey
iShares MSCI Turkey ETF (TUR - Free Report) – Up 10.1%
The Borsa Istanbul 100 index traded around 5440 in the second half of January, close to record high levels of last year, as investors kept using equities as a hedge against high inflation and a weak lira, and Turkish residents sought assets to store their savings, per tradingeconomics. The central bank of Turkey held its interest rate fixed at 9% for a second time in January, signifying the end of its rate-cutting cycle.
Clean Energy
KraneShares European Carbon Allowance Strategy ETF (KEUA - Free Report) – Up 6.9%
The underlying IHS Markit Carbon EUA Index tracks the most traded EUA futures contracts. Corporations and countries alike have recently joined in a climate initiative to shift to a decarbonized economy, helped by governments and demand from environmentally conscious consumers.
In addition to investing in renewable energies and carbon capture technologies, some companies use carbon offsets. Another way for companies to manage their carbon footprint is to buy and sell emission allowances. In the cap-and-trade system, a government sets a limit on overall emissions, which is tightened over time. Big carbon emitters need to buy these pollution permits to stay under regularity caps.
Internet
Ark Next Generation Internet ETF (ARKW - Free Report) – Up 5.5%
As rates dived occasionally last week, growth stocks gained. Internet stocks were heavily beaten-down last year but bucked the losing trend to start 2023 as these perform better in a low-rate environment.