Stocks bounced back from yesterday’s broad sell-off after a key labor report and eurozone developments helped propel U.S. equities. According to the Labor Department, Americans applying for unemployment benefits fell to its lowest level in over five years, while initial jobless claims also fell to 324,000, compared to the expected 345,000 figure. Investors, however, remain wary ahead of tomorrow’s nonfarm payrolls data. On the eurozone front, the European Central Bank cut its benchmark interest rate for the first time since July to 0.50%. ECB President Mario Draghi emphasized that the bank’s policy will remain accomodative for “as long as needed” [see The Cheapest ETF for Every Investment Objective].Global Market Overview: IEO Jumps After Pioneer Natural Resources Earnings, IYW Pops
Following today’s labor report and ECB rate cut, all three major U.S. equity indexes rallied to close in positive territory. The S&P 500 ETF (SPY, A) rose 0.94%, as its underlying index hit a fresh intra-day high. The Dow Jones Industrial Average ETF (DIA, B) ended 0.83% higher, while the tech-heavy Nasdaq ETF (QQQ, A-) popped 1.26%.
In Europe, markets were slightly higher after the ECB cut its rate to 0.50%; the Stoxx Europe 600 regained earlier losses to close up 0.3%. Meanwhile, Asian markets were lower; Japan’s Nikkei Stock Average fell 0.8%, while China’s Shanghai Composite Index slipped 0.2% after HSBC’s manufacturing purchasing managers’ index for April fell.
Bond ETF Roundup
U.S. Treasury prices were slightly higher after ECB President Mario Draghi said the central bank was open to lowering the bank’s deposit rate. Yields on five- and 10-year notes as well as 30-year bonds fell half a basis point [see also Seven Simple & Cheap ETF Model Portfolios].
Crude oil futures jumped today, posting their first gain in three sessions after a better-than-expected U.S. labor report and the ECB rate cut helped boost optimism for energy demand. Gasoline futures were also higher, while natural gas slipped. Meanwhile, gold futures traded higher as investors embraced the metal’s inflation-hedge appeal following the ECB rate cut.
ETF Chart Of The Day #1: (IEO)
The Dow Jones U.S. Oil & Gas Exploration & Production Index Fund (IEO, B+) was one of the best performers today, gaining 1.40% during the session. Energy shares were among today’s top performers after Pioneer Natural Resources (PXD) posted better-than-expected earnings, forcing this ETF to jump at the open. IEO pushed higher throughout the day, eventually settling at $70.25 a share [see Energy Bull ETFdb Portfolio].
ETF Chart Of The Day #1: (IYW)
The Dow Jones U.S. Technology Index Fund (IYW, A) also posted a strong performance today, gaining 1.30% during the session. Tech shares were among today’s top performers as several companies posted better-than expected earnings. As a result, this ETF gapped higher at the open and pushed higher throughout the day, eventually settling at $74.01 a share [see High Tech ETFdb Portfolio].
ETF Fun Fact Of The Day
The best-performing regional strategy over the trailing 13-week period has been the Global Titans ETFdb Portfolio, which has gained 3.96%.
Disclosure: No positions at time of writing.
- Mario Draghi
- Pioneer Natural Resources