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Wall Street delivered a downbeat performance last week. The S&P 500, the Dow Jones and the Nasdaq retreated 2.5%, 2.1% and 2.6%, respectively. The week was packed with big tech earnings releases.
While Microsoft overwhelmed with its cloud business, Alphabet disappointed. META reported its most profitable quarter in years and the highest quarterly revenues since going public more than a decade ago (read: Should You Buy Pureplay Cloud ETFs Instead of Single Stock Picking?).
Amazon reported robust third-quarter results, wherein it beat both earnings and revenue estimates. Amazon's cloud computing platform, record-high Prime Day sales and a rapidly growing ad sales business drove the results.
Meanwhile, in a significant development following a six-week strike, Ford Motor (F - Free Report) and United Auto Workers (“UAW”) union negotiators have reached a tentative labor deal that promises substantial pay increases for workers (read: Auto ETF in Focus as Ford & UAW Reach Tentative Labor Deal).
The Q3 U.S. GDP data also released last week. The United States witnessed substantial economic growth in the third quarter of 2023, with the real gross domestic product (GDP) growing at an annual rate of 4.9%, beating economists’ expectations of 4.7%.
Consumer spending was one of the main contributors to U.S. GDP growth. The GDP increase marked the largest gain since the fourth quarter of 2021 (read: Consumer Spending Boosts U.S. Q3 GDP: ETFs to Buy).
As far as rates are concerned, the benchmark U.S. treasury bond yield opened the week at 4.86%, hit a high of 4.95% and closed out the week at 4.84%. Against this backdrop, below we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
Inverse/Leveraged Energy ETFs
MicroSectors U.S. Big Oil Index -3X Inverse Leveraged ETN (NRGD - Free Report) ) – Up 20.8%
MicroSectors Energy 3X Inverse Leveraged ETNs (WTID - Free Report) ) – Up 19.7%
MAX Auto Industry -3x Inverse Leveraged ETN (CARD - Free Report) ) – Up 15.4%
Although there was a significant development in the auto industry last week following a six-week strike,(as Ford Motor (F - Free Report) and United Auto Workers (UAW) union negotiators have reached a tentative labor deal), pain the EV market has probably weighed on the auto stocks.
Inverse Leveraged High-Beta
Direxion Daily S&P 500 High Beta Bear 3X Shares (HIBS - Free Report) ) – Up 12%
Due to higher rates, high-beta stocks crashed last week. The release of upbeat U.S. GDP data rekindled the fear that the Fed may hike rates further in November to contain inflation. As a result, stocks slumped.
Inverse Leveraged Internet
Direxion Daily Dow Jones Internet Bear 3X Shares (WEBS - Free Report) ) – Up 11.8%
Growth industries like the Internet suffered the most amid rising rates. Invesco Nasdaq Internet ETF (PNQI - Free Report) lost about 2.4%. This clearly explains why the inverse-leveraged internet ETF dived last week.
This is another sector that underperforms in a rising rate environment. Biotech stocks – that are high growth and high-risk in nature – slumped last week hurt by a spike in bond yields.
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Best Inverse/Leveraged ETFs of Last Week
Wall Street delivered a downbeat performance last week. The S&P 500, the Dow Jones and the Nasdaq retreated 2.5%, 2.1% and 2.6%, respectively. The week was packed with big tech earnings releases.
While Microsoft overwhelmed with its cloud business, Alphabet disappointed. META reported its most profitable quarter in years and the highest quarterly revenues since going public more than a decade ago (read: Should You Buy Pureplay Cloud ETFs Instead of Single Stock Picking?).
Amazon reported robust third-quarter results, wherein it beat both earnings and revenue estimates. Amazon's cloud computing platform, record-high Prime Day sales and a rapidly growing ad sales business drove the results.
Meanwhile, in a significant development following a six-week strike, Ford Motor (F - Free Report) and United Auto Workers (“UAW”) union negotiators have reached a tentative labor deal that promises substantial pay increases for workers (read: Auto ETF in Focus as Ford & UAW Reach Tentative Labor Deal).
The Q3 U.S. GDP data also released last week. The United States witnessed substantial economic growth in the third quarter of 2023, with the real gross domestic product (GDP) growing at an annual rate of 4.9%, beating economists’ expectations of 4.7%.
Consumer spending was one of the main contributors to U.S. GDP growth. The GDP increase marked the largest gain since the fourth quarter of 2021 (read: Consumer Spending Boosts U.S. Q3 GDP: ETFs to Buy).
As far as rates are concerned, the benchmark U.S. treasury bond yield opened the week at 4.86%, hit a high of 4.95% and closed out the week at 4.84%. Against this backdrop, below we highlight a few winning inverse/leveraged ETFs of last week.
ETFs in Focus
Inverse/Leveraged Energy ETFs
MicroSectors U.S. Big Oil Index -3X Inverse Leveraged ETN (NRGD - Free Report) ) – Up 20.8%
MicroSectors Energy 3X Inverse Leveraged ETNs (WTID - Free Report) ) – Up 19.7%
Despite the crisis in the Middle East, oil prices slumped lately. Amid a pool of weak economic data and uncertainty over the Israel-Hamas war, oil prices declined. Data from Germany and Britain offered a grim outlook of the economy which is expected to weigh on oil demand (read: Guide to Energy Equities ETF Investing).
Inverse Leveraged Auto
MAX Auto Industry -3x Inverse Leveraged ETN (CARD - Free Report) ) – Up 15.4%
Although there was a significant development in the auto industry last week following a six-week strike,(as Ford Motor (F - Free Report) and United Auto Workers (UAW) union negotiators have reached a tentative labor deal), pain the EV market has probably weighed on the auto stocks.
Inverse Leveraged High-Beta
Direxion Daily S&P 500 High Beta Bear 3X Shares (HIBS - Free Report) ) – Up 12%
Due to higher rates, high-beta stocks crashed last week. The release of upbeat U.S. GDP data rekindled the fear that the Fed may hike rates further in November to contain inflation. As a result, stocks slumped.
Inverse Leveraged Internet
Direxion Daily Dow Jones Internet Bear 3X Shares (WEBS - Free Report) ) – Up 11.8%
Growth industries like the Internet suffered the most amid rising rates. Invesco Nasdaq Internet ETF (PNQI - Free Report) lost about 2.4%. This clearly explains why the inverse-leveraged internet ETF dived last week.
Inverse Leveraged Biotech
Direxion Daily S&P Biotech Bear 3x Shares (LABD - Free Report) ) – Up 11.7%
This is another sector that underperforms in a rising rate environment. Biotech stocks – that are high growth and high-risk in nature – slumped last week hurt by a spike in bond yields.