Wall Street started off the month of July with a bang, with bullish momentum returning full force on upbeat economic data. Fueling today’s rally, the Institute for Supply Management reported that its manufacturing purchasing managers index rose to 50.9 in June, up from last month’s reading of 49 (a reading above 50 indicates industry expansion). In a separate report, construction spending for the month of May also beat analysts’ expectations, rising 0.5% to its highest level in nearly four years. Meanwhile, investors looked ahead for the slew of economic news being reported during this holiday-shortened week [see The Cheapest ETF for Every Investment Objective].Global Market Overview: XHB Jumps On Construction Data, IBB Pops
Following today’s upbeat economic reports, all three major U.S. equity indexes rallied to close in positive territory. The Dow Jones Industrial Average ETF (DIA, B) rose 0.59% after its underlying index was up more than 170 points earlier in the session. The S&P 500 ETF (SPY, A) gained 0.59%, while the tech-heavy Nasdaq ETF (QQQ, A-) rose 0.62%.
In Europe, markets were broadly higher after euro-zone manufacturing PMI was reported to have risen to a 16-month high; the Stoxx Europe 600 rallied 1.1%. Meanwhile, Japan’s Nikkei Stock Average jumped 1.3% following an encouraging business sentiment report, while China’s Shanghai Composite inched 0.8% higher.
Bond ETF Roundup
U.S. Treasuries traded higher today following last week’s steep sell-off. Yields on 10-year notes fell 1.5 basis points, while 30-year bonds and 5-year note yields fell 2.5 and 3 basis points, respectively [see also Seven Simple & Cheap ETF Model Portfolios].
Crude oil futures traded higher today, settling just below $98 a barrel, on upbeat U.S., euro-zone, and Japanese data; gasoline and natural gas futures were also higher. Meanwhile, gold futures jumped more than 2% to settle at $1.255.70.
ETF Chart Of The Day #1: (XHB)
The SPDR Homebuilders ETF (XHB, A+) was one of the best performers today, gaining 1.02% during the session. Following today’s encouraging construction spending report, this ETF jumped significantly higher during the morning hours. XHB slid sideways for the remainder of the day, eventually settling at $29.72 a share [see 2013 ETFdb Portfolio].
ETF Chart Of The Day #2: (IBB)
The Nasdaq Biotechnology ETF (IBB, A-) also posted a strong performance today, gaining 2.52% during the session. After Onyx Pharmaceuticals (ONXX) announced that it rejected an unsolicited acquisition, shares of the company surged over 51%, allowing this ETF to gap higher at the open. IBB slid sideways for the remainder of the day, eventually settling at $178.26 a share [see Baby Boomers ETFdb Portfolio].
ETF Fun Fact Of The Day
The best-performing themed strategy over the trailing 3-year period has been the High Yield ETFdb Portfolio, which has gained 42.86%.
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Disclosure: No positions at time of writing.