U.S. stocks rose pretty much across the board to start May as
investors cheered the positive results from the ISM Manufacturing
Index report. In this release, the key indicator hit 54.8, well
above the consensus of 53.0 and roughly 1.4 points greater than
what analysts saw in the prior reading.
Thanks to this, industrial firms marched higher, while banks and
oil companies also saw strength in today's session. Tech and health
care were weak, but their sessions were more than cancelled out by
the strong showing in the industrial and financial corners of the
In total, the Nasdaq lagged with just a 0.1% gain while the
Dow-up 0.5%-- and the S&P 500-up 0.6%-- led the way higher for
the major benchmarks (see
Pain In The Spain ETF Continues
Currency and bond markets were mixed yet again, as the dollar
added a few basis points against many of the world's major
currencies, but especially against the yen, although it was weak
against the Aussie dollar. The 10 year did see yields move up by a
few basis points as the benchmark note added three bps to finish at
the 1.95% level.
Commodity markets were also positive, as natural gas continued
to soar higher, although the rest of the energy sector only managed
modest gains. Softs were also a big winner on the day-led by cocoa
and coffee-although orange juice and wheat saw heavy selling
pressure to start the month.
In terms of ETF volume, trading was still light in many of the
top products that dominate the industry's AUM. However, many of the
sector products, those following natural gas, and more specialized
global products all saw outsized trading on the day.
One ETF in particular that saw a surge in volume was the
iShares S&P Global Financial Sector ETF (
. This product usually sees light trading of just under 47,000
shares a day but saw a massive spike to over 850,000 shares to open
up the month (also see
Three Financial ETFs Outperforming XLF
The reason for this huge jump was unclear, although the product
does serve as a nice global barometer for the financial industry,
holding assets across a wide number of nations. American financials
were generally strong on the day while foreign firms did also see
large gains as well.
In fact, Lloyd's Banking Group and UBS led the foreign firms
higher in this space, adding, respectively, 8.2% and 2.4% on the
day. Partially thanks to this, IXG added about 0.8% in the session
and saw trading interest that reached an unheard of level for this
corner of the ETF world.
Another ETF that had a huge spike in trading was the
iShares Barclays 3-7 Year Treasury Bond Fund (
. The product usually sees trading of about 265,000 shares in a
normal session but saw volume surge to over 5.3 million shares in
Tuesday's trading (See
Three Bond ETFs For A Fixed Income Bear Market
This bump came as a number of other bond ETFs saw large moves in
terms of volume, but especially those at the shorter end of the
curve. In fact, the second biggest mover in terms of outsized
volume in the Treasury ETF market was
, a product with a one to three year focus.
Seemingly, traders are looking to position themselves in the
shorter duration side of the Treasury market ahead of some
important economic data later in the week. However, it should be
noted that both IEI and SHY finished the day slightly in the red so
it is debatable what investors can glean from this move, although
it is certainly something to keep an eye on as the week
(see more in the
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