May ETF Performance Report: India Leads

ETF Trends

Brushing off the “sell in May and go away” mantra, equities and stock exchange traded funds generated respectable monthly gains, with the S&P 500 breaking above the 1,900 level for the first time.

Over the past month, the Dow Jones Industrial Average gained 1.0%. Meanwhile, the Nasdaq Composite increased 3.5% and the S&P 500 rose 2.2%.

Top performing non-leveraged ETFs over May include the EGShares India Small Cap ETF (SCIN) up 22.4%, Market Vectors India Small-Cap Index ETF (SCIF) up 22.3% and EGShares India Infrastructure Index Fund (INXX) up 19.5%.

India’s equity markets surged as the business friendly Bharatiya Janata Party won the general elections. Prime Minister-elect Narendra Modi was brought into office on a platform of economic reforms that many believe will bolster smaller businesses, along with the infrastructure and banking sectors. [Small-Cap ETFs to Play India’s Post-Election Growth Opportunity]

However, India small-cap ETFs were giving back some of the earlier gains as the initial euphoria faded and investors looked for concrete action from the new administration. [India Small-Cap ETFs Slump After Election Rally]

The worst performing non-leveraged exchange traded products over the past month include the C-Tracks on Citit Volatility Index ETN (CVOL) down 19.9%, iPath S&P 500 VIX Short-Term Futures ETN (VXX) down 16.3% and ProShares VIX Short-Term Futures ETF (VIXY) down 16.3%. [VIX ETFs Reveal a Complacent Market]

The equities market was stuck in sideways as mixed economic data kept stocks from breaking out.

Additionally, escalating violence in eastern Ukraine and weak data from China pressured the global outlook.

In mid-May, with the Fed’s commitment to keep rates low and improving government data, investors began to ease back into the riskier assets, pushing up the equities markets.

After the Memorial Day weekend, strong industrial data fueled a rally that helped push the S&P 500 above the 1,900 level for the first time.

For more information on ETF performance, visit our ETF performance reports category.

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Max Chen contributed to this article.

The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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