After a rather lackluster open, U.S. equities managed to log in modest gains as investors weighed today’s tepid economic data. According to the Labor Department, weekly jobless claims unexpectedly increased by 10,000 to 354,000 last week; analysts were expecting the figure to come in at 340,000. In a separate report, the U.S. economy grew at a 2.4% annual rate during the first quarter, slightly lower than the initial estimate of 2.5%. Meanwhile, the National Association of Realtors reported pending home sales rising 0.3% in April to the highest level in three years. Considering today’s underwhelming U.S. economic data, many investors are now expecting the Fed to continue its bond-buying program, at least in the near future [see The Cheapest ETF for Every Investment Objective].Global Market Overview: XLF Rallies, VNQ Sinks Alongside REITs
Despite today’s downbeat economic reports, all three major U.S. equity indexes managed to close in positive territory. The Dow Jones Industrial Average ETF (DIA, B) inched 0.17% higher after its underlying index recovered from its worst one-day drop in nearly a month. The S&P 500 ETF (SPY, A) gained 0.37%, while the tech-heavy Nasdaq ETF (QQQ, A-) rose 0.52%.
In Europe, markets were broadly higher after encouraging business and consumer confidence data hit the street; the Stoxx Europe 600 gained 0.3%. Meanwhile, Japan’s Nikkei Stock Average tumbled 5.15% on a strengthening yen and a volatile Japanese government bond trading session. China’s Shanghai Composite Index slipped 0.27%.
Bond ETF Roundup
U.S. Treasuries were in for a volatile session following a strong government auction of 7-year notes. Yields on 10-year notes fell slightly to 2.114%, while 30-year bond yields rose half a basis point and 5-year note yields were up slightly at 1.013% [see also Seven Simple & Cheap ETF Model Portfolios].
Crude oil futures ended slightly higher today, settling above $93 a barrel, as investors weighed inventory and economic data. According to the U.S. Energy Information Administration, crude oil supplies for the week ended May 24 rose to the highest level since the administration began collecting data in 1978. Meanwhile, gold rose to a two-week high on a weaker dollar and weaker-than-expected U.S. economic data.
ETF Chart Of The Day #1: (XLF)
The Financial Select Sector SPDR ETF (XLF, A) was one of the best performers today, gaining 1.20% during the session. Financial shares were among today’s top performers, allowing this ETF to jump during the first hour of trading. XLF inched higher throughout the day, eventually settling at $20.17 a share [see 8% Yield ETFdb Portfolio].
ETF Chart Of The Day #2: (VNQ)
The REIT ETF (VNQ, A+) was one of the worst performers today, shedding 0.94% during the session. As REITs continued to be under pressure, this ETF fell sharply at the open. VNQ inched lower throughout the day, eventually settling at $71.74 a share [see Kitchen Sink ETFdb Portfolio].
ETF Fun Fact Of The Day
The best-performing themed strategy over the trailing 13-week period has been the Baby Boomers ETFdb Portfolio, which has gained 12.31%.
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Disclosure: No positions at time of writing.