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Wall Street was upbeat last week with the S&P 500, the Dow Jones, the Nasdaq and the Russell 2000 adding 2.2%, 1.9%, 2.4% and 5.4%, respectively. The reason behind the market rally was cooling inflation. Softening in the inflation data triggered the possibility of a less-hawkish Fed, going forward.
Following the release of this data, market indicators showed a nearly 95% probability that the Federal Reserve would keep interest rates unchanged in December, as reflected in data from the CME Group. Notably, the Consumer Price Index (CPI) showed prices rose 0% over last month and 3.2% over the prior year in October, a deceleration from September's 0.4% monthly increase and 3.7% annual gain in prices (read: Slowest Inflation Since Sep'21 to Boost Growth ETFs in Near Term).
Economists' expectations fell short of the actual data, as they had predicted a 0.1% month-over-month increase and a 3.3% year-over-year increase in prices. Core prices were also anticipated to rise by 0.3% over the prior month and 4.1% over the previous year. Core inflation marked its slowest pace in over two years.
The technology sector had regained its momentum. The renewed confidence is driven by hopes that the Fed’s aggressive interest rate hiking campaign might be nearing an end. Additionally, hedge funds' upsurge in big tech investments added to the strength. Tech ETFs hit 52-week highs.
Bitcoin surged to near $38,000 — a level last seen in May 2022 — powered by an ongoing rally spurred by ETF demand expectations. The ongoing rally spurred by expectations of regulatory approval for Bitcoin ETFs in the United States has pushed the world's largest cryptocurrency to this height (read: Bitcoin Rallies Close to $38,000: 5 ETF Winners).
Against this backdrop, below we highlight a few winning inverse/leveraged ETFs.
U.S. benchmark treasury yield slumped to 4.44% on Nov 17, 2023 from 4.63% recorded at the start of the week while the two-year Treasury notes yielded 4.88% on Nov 17, 2023, down from 5.02% recorded at the start of the week.
Banks often perform better when the yield curve steepens. If the Fed stays put from here resulting lower short-term rates and long-term rates go up on increased activities in the economy, banks would fare better as this would result in higher net interest margin. Plus, certain financial services like mortgage lending can see increased activity due to the attractiveness of lower borrowing costs.
Biotechnology is a major growth investing areas. The falling rates are plus for the space. Also, the ongoing advancement in personalized medicine, gene therapy, and telehealth services, driven by an aging global population and the need for more efficient healthcare solutions, suggests strong potential for these industries (read: "Worst of U.S. Inflation Over"? ETF Areas Likely to Gain).
This ETF is active and does not track a benchmark. The fund offers attractive opportunity that allows investors to obtain leveraged long exposure to a concentrated portfolio of secular growth companies. These winning areas include the likes of next-gen Internet, electric vehicles, genomics, fintech.
The underlyng MerQube MicroSectors U.S. Travel Index is a total return index that tracks the stock prices of U.S. domiciled and listed securities that are materially engaged in specified segments of the travel industry. Buoyant air-travel scenario is probably favoring the fund. This is especially true given Airlines expect the most air travelers ever this holiday season.
T-REX 2X Long Tesla Daily Target ETF (TSLT - Free Report) ) – Up 18.3%
Tesla stock jumped 8.7% last week, contributing to solid gains in this leveraged ETF TSLT. The T-REX 2X Long Tesla Daily Target ETF seeks daily investment results, before fees and expenses, of 200% of the daily performance of TSLA. The expense ratio of 1.05%.
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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, the Nasdaq and the Russell 2000 adding 2.2%, 1.9%, 2.4% and 5.4%, respectively. The reason behind the market rally was cooling inflation. Softening in the inflation data triggered the possibility of a less-hawkish Fed, going forward.
Following the release of this data, market indicators showed a nearly 95% probability that the Federal Reserve would keep interest rates unchanged in December, as reflected in data from the CME Group. Notably, the Consumer Price Index (CPI) showed prices rose 0% over last month and 3.2% over the prior year in October, a deceleration from September's 0.4% monthly increase and 3.7% annual gain in prices (read: Slowest Inflation Since Sep'21 to Boost Growth ETFs in Near Term).
Economists' expectations fell short of the actual data, as they had predicted a 0.1% month-over-month increase and a 3.3% year-over-year increase in prices. Core prices were also anticipated to rise by 0.3% over the prior month and 4.1% over the previous year. Core inflation marked its slowest pace in over two years.
The technology sector had regained its momentum. The renewed confidence is driven by hopes that the Fed’s aggressive interest rate hiking campaign might be nearing an end. Additionally, hedge funds' upsurge in big tech investments added to the strength. Tech ETFs hit 52-week highs.
Bitcoin surged to near $38,000 — a level last seen in May 2022 — powered by an ongoing rally spurred by ETF demand expectations. The ongoing rally spurred by expectations of regulatory approval for Bitcoin ETFs in the United States has pushed the world's largest cryptocurrency to this height (read: Bitcoin Rallies Close to $38,000: 5 ETF Winners).
Against this backdrop, below we highlight a few winning inverse/leveraged ETFs.
ETFs in Focus
Direxion Daily Regional Banks Bull 3X Shares (DPST - Free Report) ) – Up 28.2%
U.S. benchmark treasury yield slumped to 4.44% on Nov 17, 2023 from 4.63% recorded at the start of the week while the two-year Treasury notes yielded 4.88% on Nov 17, 2023, down from 5.02% recorded at the start of the week.
Banks often perform better when the yield curve steepens. If the Fed stays put from here resulting lower short-term rates and long-term rates go up on increased activities in the economy, banks would fare better as this would result in higher net interest margin. Plus, certain financial services like mortgage lending can see increased activity due to the attractiveness of lower borrowing costs.
Direxion Daily S&P Biotech Bull 3x Shares (LABU - Free Report) ) – Up 26.3%
Biotechnology is a major growth investing areas. The falling rates are plus for the space. Also, the ongoing advancement in personalized medicine, gene therapy, and telehealth services, driven by an aging global population and the need for more efficient healthcare solutions, suggests strong potential for these industries (read: "Worst of U.S. Inflation Over"? ETF Areas Likely to Gain).
AXS 2X Innovation ETF (TARK - Free Report) ) – Up 20.3%
This ETF is active and does not track a benchmark. The fund offers attractive opportunity that allows investors to obtain leveraged long exposure to a concentrated portfolio of secular growth companies. These winning areas include the likes of next-gen Internet, electric vehicles, genomics, fintech.
MicroSectors Travel 3x Leveraged ETN (FLYU - Free Report) ) – Up 19.2%
The underlyng MerQube MicroSectors U.S. Travel Index is a total return index that tracks the stock prices of U.S. domiciled and listed securities that are materially engaged in specified segments of the travel industry. Buoyant air-travel scenario is probably favoring the fund. This is especially true given Airlines expect the most air travelers ever this holiday season.
T-REX 2X Long Tesla Daily Target ETF (TSLT - Free Report) ) – Up 18.3%
Tesla stock jumped 8.7% last week, contributing to solid gains in this leveraged ETF TSLT. The T-REX 2X Long Tesla Daily Target ETF seeks daily investment results, before fees and expenses, of 200% of the daily performance of TSLA. The expense ratio of 1.05%.