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ETF Asset Flow in Election Week

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Mirroring the surprise that Trump’s election win gave not only America but the entire world, the markets too defied all speculation. After the initial stumble, a ‘great rotation’ from bonds to stocks occurred, proving almost every poll wrong (read: The Trump Effect: 8 Must-See ETF Charts).

The Dow logged its biggest weekly gain in almost five years. Hopes of increased fiscal spending, a lenient regulatory environment and lower taxes did the trick. Market watchers benevolently bet on higher growth and an inflationary outlook, though the outcome is yet to be seen.

Needless to say, this Trump rally made a meaningful impact on ETF asset flows. Let’s find out the top gainers and losers in terms of asset growth in the election week from November 7 to November 11 (source:  

S&P 500: Star Performer

The S&P 500 was on investors’ radar as they flocked to SPDR S&P 500 ETF Trust SPY. The fund garnered about $14 billion in assets in the week, to reflect a Trump rally. This is a clear indication of restored confidence in the riskier asset segments. iShares Core S&P 500 ETF IVV and Vanguard S&P 500 Index Fund VOO fetched about $1.31 billion and $763.2 million in assets, respectively.

Finance Wins Favor

Since Trump is not supportive of the stringent Dodd-Frank Regulatory Act especially on smaller banks, his win went in favor of financial stocks. Plus, a rising rate environment was an added advantage. As a result,Financial Select Sector SPDR ETF XLF hauled in $3.91 billion in assets in the week (read: Trump Win Sparks Sell-Off in Bonds: Short with These ETFs).

Small-Cap the Sweet Spot

With rising yield, the greenback surged to about a one-year high. This makes way for a rally in the small-caps which mostly deal with the domestic arena, have less exposure to foreign lands and are unperturbed by negative currency translation. Plus, speculation of higher domestic job creation and growth bring small-caps in the spot light. Small-cap ETF iShares Russell 2000 ETF IWM added about $3.82 billion in assets.

Healthcare Regains Health

With Trump winning the U.S. presidential election, the biotech and pharma sectors have regained their lost ground. Since Clinton – who has long been vocal against the price gouging issue in the pharma sector – is no more threat to the sector, pharma and biotech stocks should get a break from controversies, at least for some time.

Health Care Select Sector SPDR Fund XLV and iShares NASDAQ Biotechnology ETF (IBB) gathered about $1.93 billion and $814.8 million in assets, respectively (read: 5 Reasons to Buy 5 Low P/E Biotech ETFs).

Industrial Marches Ahead

The industrial sector has been an area to watch lately. With Trump highly expected to bring U.S. manufacturing jobs back to the country and strictly oppose outsourcing, the industrial sector has started cheering his win. Also, Trump is expected to boost spending on infrastructure giving investors another reason to pour about $1.63 billion in net assets into Industrial Select Sector SPDR Fund XLI (read: Sector ETFs Hitting 52-Week High on Trump's Victory).

Emerging Market Loses

This segment faced the double whammy of a falling currency and Trump’s controversial stance on foreign policies regarding trade, immigration and outsourcing. Since many emerging markets are known as solid manufacturing outsourcing hubs, iShares MSCI Emerging Markets ETF EEM saw about $2.26 billion of funds gushing out.

Nasdaq-100 Could Not Make It to the Winners’ List

Since Trump’s planned trade and immigration policies may weigh on big technology companies, tech-laden PowerShares QQQ Trust QQQ lost about $838.8 million in assets in the week.

Gold Lost Its Glitter   

With safe-havens losing their appeal and the greenback rising, gold fell out of investors’ favor. SPDR Gold Trust GLD and iShares Gold Trust IAU shed about $619.8 million and $500.3 million in assets, respectively.

Utility and Real Estate: Losers of Rising Rates

As long-term bond yields rose sharply, rate-sensitive sectors like iShares U.S. Real Estate ETF (IYR - Free Report) and Utilities Select Sector SPDR Fund (XLU) shed about$514.1 million and$463.6 million, respectively.

Consumers Out of Favor

Rising rates perhaps did not bode well for both consumer discretionary and staples ETFs including First Trust Consumer Discretionary AlphaDEX Fund FXD) and Consumer Staples Select Sector SPDR Fund XLP. FXD and XLP shed about $698.4 million and $518.7 million in assets, respectively.

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