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S&P 500's Best 3-Day Run in 2024: ETF Areas That Won
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Wall Street was in great shape on Monday, with the S&P 500 experiencing its largest three-day rally of the year, fueled by anticipations of Federal Reserve rate cuts in 2024 and upbeat earnings as well as guidance and analysts’ estimates. The S&P 500 increased by 3.23% and the tech-focused Nasdaq Composite advanced by 4.8%. The Dow Jones Industrial Average saw a 2.5% rise.
On May 6, 2024, Tom Barkin, President of the Richmond Federal Reserve, commented that the current interest rates should be enough to gradually reduce inflation to the Fed's target of 2%. Per Barkin, "the economy is moving toward better balance, but no one wants inflation to reemerge."
In addition, John Williams, President of the Federal Reserve Bank of New York, stated that any decisions on rate cuts would be based on a comprehensive review of economic data, but noted that the current monetary policy is "in a very good place."
Stocks continued their upward trend from last week, thanks to a jobs report that came in at decent but fell short of estimates. Such data sparked concerns about bets over sooner-than-expected rate cuts.
According to the CME FedWatch Tool, over two-thirds of wagers now predict a rate cut from the Fed in September, with most traders anticipating at least two reductions by the year's end (read: 4 Sector ETFs & Stocks Likely to Benefit Despite Soft Jobs Data).
Let’s take a at the sectors that stayed strong in the past three days.
Several biotech stocks have been rallying lately. Some of the recent S&P 500 biotech and pharma winners include BioTechne Corp, Moderna, Amgen and Pfizer. The fund IBB gained more than 4% in the past five days and 3% in the past three days.
The U.S. benchmark treasury yield fell sharply in May. This boosted growth stocks and biotech technology. Novel drug launches, likely low rates and potential easy access to funds should buoy the zone in the near term.
The fund added about 3% during the last three days. Howmet Aerospace (HWM - Free Report) surged 20% in the same period. Howmet Aerospace engages in providing engineered solutions for customers in the transportation and aerospace (both defense and commercial) industries. Another aerospace and defense stock Leidos Holdings (LDOS) added more than 3% in the last three days.
The Aerospace and Defense sector has been an area to watch lately, given the escalating geopolitical tensions and the depletion of weapon stocks. Additionally, rising merger and acquisition activities, and cheaper valuation are favorable for the sector.
First Solar Inc. (FSLR - Free Report) added 9% in the last three days, while the fund TAN gained 7.3% (as of May 6). Electricity generation in the Solar Energy market is projected to amount to 0.73tn KWh in 2024, and an annual growth rate of 3.57% is expected (CAGR 2024-2028).
Technology – Global X Internet of Things ETF (SNSR - Free Report)
The fund has advanced about 5% in the last three days. Garmin Ltd. (GRMN - Free Report) has about 7.29% exposure to SNSR. Garmin is an original equipment manufacturer of navigation and communication equipment that incorporate the global positioning system-based technology. The latest craze of AI and self-driving cars has boosted the demand for products Garmin produces.
Electric Vehicles – Global X Autonomous & Electric Vehicles ETF (DRIV - Free Report)
Another stock, BorgWarner (BWA - Free Report) , jumped 11% in the last three days. The company is a global leader in clean and efficient technology solutions, required for combustion, hybrid and electric vehicles. Its products include four-wheel-drive and all-wheel-drive transfer cases (primarily for light trucks and sport utility vehicles or SUVs), as well as automatic transmission and timing chain systems.
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S&P 500's Best 3-Day Run in 2024: ETF Areas That Won
Wall Street was in great shape on Monday, with the S&P 500 experiencing its largest three-day rally of the year, fueled by anticipations of Federal Reserve rate cuts in 2024 and upbeat earnings as well as guidance and analysts’ estimates. The S&P 500 increased by 3.23% and the tech-focused Nasdaq Composite advanced by 4.8%. The Dow Jones Industrial Average saw a 2.5% rise.
On May 6, 2024, Tom Barkin, President of the Richmond Federal Reserve, commented that the current interest rates should be enough to gradually reduce inflation to the Fed's target of 2%. Per Barkin, "the economy is moving toward better balance, but no one wants inflation to reemerge."
In addition, John Williams, President of the Federal Reserve Bank of New York, stated that any decisions on rate cuts would be based on a comprehensive review of economic data, but noted that the current monetary policy is "in a very good place."
Stocks continued their upward trend from last week, thanks to a jobs report that came in at decent but fell short of estimates. Such data sparked concerns about bets over sooner-than-expected rate cuts.
According to the CME FedWatch Tool, over two-thirds of wagers now predict a rate cut from the Fed in September, with most traders anticipating at least two reductions by the year's end (read: 4 Sector ETFs & Stocks Likely to Benefit Despite Soft Jobs Data).
Let’s take a at the sectors that stayed strong in the past three days.
Biotech – iShares Biotechnology ETF (IBB - Free Report)
Several biotech stocks have been rallying lately. Some of the recent S&P 500 biotech and pharma winners include BioTechne Corp, Moderna, Amgen and Pfizer. The fund IBB gained more than 4% in the past five days and 3% in the past three days.
The U.S. benchmark treasury yield fell sharply in May. This boosted growth stocks and biotech technology. Novel drug launches, likely low rates and potential easy access to funds should buoy the zone in the near term.
Aerospace & Defense – iShares U.S. Aerospace & Defense ETF (ITA - Free Report)
The fund added about 3% during the last three days. Howmet Aerospace (HWM - Free Report) surged 20% in the same period. Howmet Aerospace engages in providing engineered solutions for customers in the transportation and aerospace (both defense and commercial) industries. Another aerospace and defense stock Leidos Holdings (LDOS) added more than 3% in the last three days.
The Aerospace and Defense sector has been an area to watch lately, given the escalating geopolitical tensions and the depletion of weapon stocks. Additionally, rising merger and acquisition activities, and cheaper valuation are favorable for the sector.
Clean Energy – Invesco Solar ETF (TAN - Free Report)
First Solar Inc. (FSLR - Free Report) added 9% in the last three days, while the fund TAN gained 7.3% (as of May 6). Electricity generation in the Solar Energy market is projected to amount to 0.73tn KWh in 2024, and an annual growth rate of 3.57% is expected (CAGR 2024-2028).
Technology – Global X Internet of Things ETF (SNSR - Free Report)
The fund has advanced about 5% in the last three days. Garmin Ltd. (GRMN - Free Report) has about 7.29% exposure to SNSR. Garmin is an original equipment manufacturer of navigation and communication equipment that incorporate the global positioning system-based technology. The latest craze of AI and self-driving cars has boosted the demand for products Garmin produces.
Electric Vehicles – Global X Autonomous & Electric Vehicles ETF (DRIV - Free Report)
Another stock, BorgWarner (BWA - Free Report) , jumped 11% in the last three days. The company is a global leader in clean and efficient technology solutions, required for combustion, hybrid and electric vehicles. Its products include four-wheel-drive and all-wheel-drive transfer cases (primarily for light trucks and sport utility vehicles or SUVs), as well as automatic transmission and timing chain systems.