It was a volatile session on Wall Street today, fueled by concerns over potential Fed policy changes and disappointing data from China. Overnight, Japan’s Nikkei Stock average plummeted over 7%, sparking a broad global sell off and a brutal open in the U.S.. Stocks did, however, manage to recover some earlier losses after several better-than-expected economic readings were reported; U.S. new-home sales topped analysts forecasts, while the Labor Department reported unemployment benefits falling by 23,000 last week. In a separate report, flash Markit manufacturing PMI also came in stronger than expected in May [see The Cheapest ETF for Every Investment Objective].
Global Market Overview: DXJ Tumbles After Nikkei Freefall, XLU Slumps
Following a broad global sell-off, all three major U.S. equity indexes fell to close in negative territory. The Dow Jones Industrial Average ETF (DIA, B) slipped 0.06%, after its underlying index fell sharply lower at the open. The S&P 500 ETF (SPY, A) lost 0.28%, while the tech-heavy Nasdaq ETF (QQQ, A-) fell 0.28%.
In Europe, markets were broadly lower on Fed fears; the Stoxx Europe 600 fell 2.0%. Meanwhile, Asian markets were also lower after investors reacted to a disappointing report on Chinese manufacturing: Japan’s Nikkei Stock Average tumbled 7.32%, while China’s Shanghai Composite Index edged 1.16% lower.
Bond ETF Roundup
U.S. Treasury prices managed to trade slightly higher today after a highly volatile trading session. Yields on 10-year notes fell 1.5 basis points, while 30-year bond yields fell 1.5 basis points and 5-year note yields were slightly lower at 0.901% [see also Seven Simple & Cheap ETF Model Portfolios].
Crude oil futures were slightly higher today, settling above $94 a barrel, after US new home sales and jobless claims came in better than expected. In other energy trading natural gas and gasoline prices were also higher. Meanwhile, gold rallied 2% on a weaker dollar.
ETF Chart Of The Day #1: (DXJ)
The Japan Hedged Equity Fund (DXJ, A+) was one of the worst performers today, shedding an abysmal 4.31% during the session. As Japanese equities plummeted and the yen strengthened against the dollar, this ETF gapped significantly lower at the open with trading volumes popping over 2.1 billion shares. DXJ managed to inch slightly higher throughout the day, eventually settling at $50.36 a share [see Asia-Centric ETFdb Portfolio].
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ETF Chart Of The Day #2: (XLU)
The Utilities Select Sector SPDR ETF (XLB, A) also posted a weak performance today, shedding 0.68% during the session. Utilities shares were among today’s weakest performers, forcing this ETF to gap significantly lower at the open. XLU managed to recover some earlier losses, eventually settled at $39.25 a share [see Kitchen Sink ETFdb Portfolio].
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ETF Fun Fact Of The Day
The best-performing regional strategy year-to-date has been the Global Titans ETFdb Portfolio, which has gained 9.00%.
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Disclosure: No positions at time of writing.
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