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Last week, Wall Street was upbeat. The S&P 500 (up 2.6%), the Dow Jones (up 1.3%) and the Nasdaq (up 3.3%) — the three key U.S. equity gauges gained by a decent measure. The S&P 500 has, in fact, entered a new bull market.
Fed & ECB Moves
Global markets saw the Fed turning hawkish despite the pause in rate hike last week. The U.S. central bank paused on its rate hike momentum while indicating more hikes for the future. The committee's dot plot revealed expectations of a funds rate of 5.6% by the end of 2023, implying that two more quarter-point rate hikes are likely before the year's end (read: Quality ETFs to Shine as More Fed Hikes Loom Despite June Pause?).
The move was expected as U.S. consumer inflation took a dip to touch 4.0% in May 2023, marking the lowest since March 2021 and slightly below market expectations of 4.1%. This decline was primarily driven by a decrease in energy prices, predominantly gasoline and electricity (read: 7 ETF Areas to Tap 2-Year Low Inflation in May).
Meanwhile, the European Central Bank (ECB) announced on Thursday that it raised its main rate by 25 basis points to 3.5%. The decision marks a continuation of the rate-raising cycle initiated by the ECB in July 2022, aimed at curbing the record-high inflation rampant across the region (read: ECB Hikes Rates to Highest in 22 Years: ETFs to Play).
U.S. Retail Sales Beat Expectations
In May 2023, retail sales in the United States experienced an unexpected 0.3% month-over-month growth, surpassing predictions of a 0.1% decrease and continuing the upward trend from a 0.4% rise in April. These figures indicate that consumer spending remains strong and resilient.
Oracle Shines
Oracle (ORCL) became one of the top-performing stocks last week as the company reported solid fourth-quarter fiscal 2023 results, beating both revenue and earnings estimates. The software giant forecast an upbeat first quarter, driven by growing demand for its cloud offerings from companies deploying artificial intelligence (AI) (read: Oracle Beats on Earnings in Q4, Shares Jump: ETFs to Tap).
Cryptocurrencies Gain
Cryptocurrencies jumped to end the week as the world’s largest asset manager BlackRock’s plans to launch a bitcoin ETF. Investors should also note that, at the end of last week, the world's largest cryptocurrency exchange, Binance, managed to avoid a comprehensive asset freeze that the Securities and Exchange Commission (SEC) had requested. The court ordered Binance and its U.S. subsidiary to repatriate all of the country’s customer assets and facilitate withdrawals. This would ensure that Binance U.S. users can access their funds.
The SEC accused Binance and its CEO, Changpeng Zhao, of operating an unregistered securities exchange and brought out a lawsuit against them on Jun 5. The lawsuit alleges violations of securities laws, misleading investors, wash trading, and earning $11.6 billion in fees from unregistered business operations.
Against this backdrop, below, we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
ProShares Ultra Bloomberg Natural Gas (BOIL - Free Report) ) – Up 30.3%
Natural gas prices advanced on soaring gas prices in Europe and a decline in U.S. production. U.S. utilities added 84 billion cubic feet of gas into storage during the week ended Jun 9, 2023, less than market expectations of a 95 bcf increase.
Direxion Daily Electric and Autonomous Vehicles Bull 2X Shares (EVAV - Free Report) ) – Up 27.0%
With the EV market in the United States gaining pace and improving charging infrastructure, the industry presents itself as an attractive investment sector. No wonder, the leveraged fund jumped last week.
Global X MSCI Nigeria ETF ) – Up 19.3%
Nigeria stocks soared to a 15-year high due to the ouster of central bank governor Godwin Emefiele. Investors betting on a currency devaluation sent the main index of the Nigerian Exchange soaring, per Bloomberg.
GraniteShares 1.5x Long NVDA Daily ETF (NVDL - Free Report) ) – Up 15.5%
Nvidia continued to gain on its AI euphoria. The stock is in cloud nine since reporting earnings. The stock surged 8.9% last week.
The fund looks to follow 300% of the performance of the S&P Transportation Select Industry FMC Capped Index. The index is heavily weighted on Union Pacific and United Parcel Service. Both stocks are great growth and momentum stocks. With economic activities gathering steam, such sectors and stocks have every reason to surge.
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Top Inverse/Leveraged ETFs of Last Week
Last week, Wall Street was upbeat. The S&P 500 (up 2.6%), the Dow Jones (up 1.3%) and the Nasdaq (up 3.3%) — the three key U.S. equity gauges gained by a decent measure. The S&P 500 has, in fact, entered a new bull market.
Fed & ECB Moves
Global markets saw the Fed turning hawkish despite the pause in rate hike last week. The U.S. central bank paused on its rate hike momentum while indicating more hikes for the future. The committee's dot plot revealed expectations of a funds rate of 5.6% by the end of 2023, implying that two more quarter-point rate hikes are likely before the year's end (read: Quality ETFs to Shine as More Fed Hikes Loom Despite June Pause?).
The move was expected as U.S. consumer inflation took a dip to touch 4.0% in May 2023, marking the lowest since March 2021 and slightly below market expectations of 4.1%. This decline was primarily driven by a decrease in energy prices, predominantly gasoline and electricity (read: 7 ETF Areas to Tap 2-Year Low Inflation in May).
Meanwhile, the European Central Bank (ECB) announced on Thursday that it raised its main rate by 25 basis points to 3.5%. The decision marks a continuation of the rate-raising cycle initiated by the ECB in July 2022, aimed at curbing the record-high inflation rampant across the region (read: ECB Hikes Rates to Highest in 22 Years: ETFs to Play).
U.S. Retail Sales Beat Expectations
In May 2023, retail sales in the United States experienced an unexpected 0.3% month-over-month growth, surpassing predictions of a 0.1% decrease and continuing the upward trend from a 0.4% rise in April. These figures indicate that consumer spending remains strong and resilient.
Oracle Shines
Oracle (ORCL) became one of the top-performing stocks last week as the company reported solid fourth-quarter fiscal 2023 results, beating both revenue and earnings estimates. The software giant forecast an upbeat first quarter, driven by growing demand for its cloud offerings from companies deploying artificial intelligence (AI) (read: Oracle Beats on Earnings in Q4, Shares Jump: ETFs to Tap).
Cryptocurrencies Gain
Cryptocurrencies jumped to end the week as the world’s largest asset manager BlackRock’s plans to launch a bitcoin ETF. Investors should also note that, at the end of last week, the world's largest cryptocurrency exchange, Binance, managed to avoid a comprehensive asset freeze that the Securities and Exchange Commission (SEC) had requested. The court ordered Binance and its U.S. subsidiary to repatriate all of the country’s customer assets and facilitate withdrawals. This would ensure that Binance U.S. users can access their funds.
The SEC accused Binance and its CEO, Changpeng Zhao, of operating an unregistered securities exchange and brought out a lawsuit against them on Jun 5. The lawsuit alleges violations of securities laws, misleading investors, wash trading, and earning $11.6 billion in fees from unregistered business operations.
Against this backdrop, below, we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
ProShares Ultra Bloomberg Natural Gas (BOIL - Free Report) ) – Up 30.3%
Natural gas prices advanced on soaring gas prices in Europe and a decline in U.S. production. U.S. utilities added 84 billion cubic feet of gas into storage during the week ended Jun 9, 2023, less than market expectations of a 95 bcf increase.
Direxion Daily Electric and Autonomous Vehicles Bull 2X Shares (EVAV - Free Report) ) – Up 27.0%
With the EV market in the United States gaining pace and improving charging infrastructure, the industry presents itself as an attractive investment sector. No wonder, the leveraged fund jumped last week.
Global X MSCI Nigeria ETF ) – Up 19.3%
Nigeria stocks soared to a 15-year high due to the ouster of central bank governor Godwin Emefiele. Investors betting on a currency devaluation sent the main index of the Nigerian Exchange soaring, per Bloomberg.
GraniteShares 1.5x Long NVDA Daily ETF (NVDL - Free Report) ) – Up 15.5%
Nvidia continued to gain on its AI euphoria. The stock is in cloud nine since reporting earnings. The stock surged 8.9% last week.
Direxion Daily Transportation Bull 3X Shares (TPOR - Free Report) ) – Up 14.2%
The fund looks to follow 300% of the performance of the S&P Transportation Select Industry FMC Capped Index. The index is heavily weighted on Union Pacific and United Parcel Service. Both stocks are great growth and momentum stocks. With economic activities gathering steam, such sectors and stocks have every reason to surge.