American stocks had another choppy session as indexes finished
mixed during Wednesday trading. The Dow fell by about seven points
while the S&P 500 added two points on the day. Meanwhile, the
Nasdaq put up a solid performance, adding 0.5% while tech
reported decent results after the bell, hiking its dividend and
likely boosting sentiment heading into the end of the week for the
Beyond this, investors saw pretty mixed trading from a sector
perspective, as utilities and basic materials fell broadly.
Meanwhile, financials, tech, and services were broadly higher,
although there was some weakness in the major health care segment
ETF Investing 101
Currency trading was again mixed with the dollar rising slightly
against most of the world's major currencies, and especially so
against the yen and the Aussie dollar. Treasury rates did continue
to rise, however, as the 10 year added another eight basis points
to finish the day above the 1.8% mark.
Commodity markets did add broadly on the session, as orange
juice (+4.6%), gasoline (+2.5%), and soybeans (+2.3%), led the way
on the upside. For losers, natural gas fell almost 2.7% while
investors saw a similarly bad performance in the lean hogs market
For ETF trading, volume did edge up a little but it was still
quite low when compared to historical levels. However, there was
some good volume in a few segments, as a couple of sector products,
national ETFs, and commodity funds saw outsized levels of trading
during Wednesday's session.
In particular, ETF investors saw a big move in trading for the
iPath DJ-UBS Livestock TR Sub Index ETN (
. The product usually does about 31,000 shares in volume on a
normal day but saw over 107,000 shares move hands during Wednesday
Bet on Higher Food Prices with These Three ETFs
A large reason for the increase was probably due to the
aforementioned volatility in the lean hogs market. Contracts
representing this commodity make up about 30% of the portfolio and
were a large reason for COW's 0.9% decline in today's trading.
Luckily for investors in this product, live cattle, which make up
the rest of the assets, didn't have such a bad day, helping to buoy
shares of this product for the day.
Another fund which saw outsized trading levels was the
Vanguard Extended Duration Treasury Index ETF (
. This fund usually sees trading levels of just under 39,000 shares
in a normal day but did volume of just over 96,000 shares today
Is The Bear Market For Bond ETFs Finally Here?
This large increase in trading was probably due to the weak
Treasury market performance as of late which pushed EDV down about
2.2% on the session and continued the fund's trend off of its 52
week highs. In fact, the 30 year Treasury is now yielding about
2.9%, close to 40 basis points higher than its level just one month
Since Treasury bond yields and prices move inversely, this
increase in rates has crushed long term products like EDV over the
past few weeks. The Vanguard fund is actually down about 8.1% in
the past month, although it is still up about 0.9% in the
(see more in the
IPATH-DJ-A LVST (COW): ETF Research Reports
VANGD-EX DUR TR (EDV): ETF Research Reports
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