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3 ETFs in Focus on S&P 500's Best Weekly Gains YTD

After suffering heavily immediately after the Brexit vote, the S&P 500 rebounded heavily to register the highest weekly gain since Nov 20 last week. Fading fears over Brexit and strong gains in oil prices emerged as the main factors behind the rebound. The benchmark registered a weekly gain of 3.2% last week. This helped the ETFs that track the performance of the S&P 500 index to register healthy gains over the past week.

Talks of Aggressive Stimulus in UK Cheer Up Investors

Investors' significant interest in buying stocks of beaten down sectors including financials following Brexit played the key role in abating fears over Britain's decision to leave the European Union. The broader financial sectors - Financial Services Select Sector SPDR XLFS and Financial Select Sector SPDR XLF - gained 3.2% and 3%, last week (read: UK Votes for Brexit: ETFs Winners & Losers ).

Meanwhile, rising expectations of more aggressive economic stimulus in England also had a positive impact on investor sentiment. Governor of Bank of England Mark Carney indicated that new stimulus measures might be required to boost the country's economy. Carney said "the economic outlook has deteriorated and some monetary policy easing with likely to be required over the summer." He added that in August the central bank will "discuss further the range of instruments at our disposal," and will take any "additional measures required to meet" their responsibilities as the UK "moves forward" (read: Europe After Brexit: 5 Keys to Investing with ETFs )

Strong Gains in Oil Prices

Both the WTI and Brent crude increased 5.7% over the past week, which in turn led energy sectors to register healthy gains. The broader energy sector - Energy Select Sector SPDR ETF XLE - gained 2.7% during the same period. Oil prices recovered on a weaker dollar, strikes in Norway and production disruption in Venezuela. The recent strike of oil workers in Norway also negatively impacted crude output. Moreover, refiners and oil producers in Venezuela struggled to maintain production following equipment shortages and power interruptions.

Also, the U.S. Energy Information Administration (EIA) reported that U.S. commercial crude oil inventories fell by 4.1 million barrels to 526.6 million for the week ended June 24. U.S. crude inventories registered their sixth straight weekly decline. This was wider than analysts' forecast of a decrease of 2.4 million barrels (read: Inside Surging MLP ETFs ).

3 ETFs in Focus

The strong rebound helped the S&P 500 to finish last week above the psychological level of 2,100. In this scenario, we have highlighted three popular ETFs that track the performance of the S&P 500 and will remain on investor's radar at least in the near term. These ETFs also have a Zacks ETF Rank #3 (Hold) with a Medium risk outlook.

SPDR S&P 500 ETFSPY

This fund holds 505 securities in its basket with 17.8% of its assets invested in the top 10 holdings. Information Technology occupies the top position from a sector look at 19.8% while Financials takes the next position with 15.6% of its assets. SPY returned 3.5% last week. The fund is quite popular with $178.8 billion AUM and a strong daily average volume of more than 122 million shares. The fund charges only 9 bps in annual fees and has an annual dividend yield of 2.1% (read: U.S. Equity ETFs Top Asset Flows Last Week ).

iShares Core S&P 500IVV

This product maintains a portfolio of 504 securities in its basket with 17.8% of its assets invested in the top 10 holdings. Like SPY, Information Technology occupies the top position from a sector look at 19.7% while Financials takes the next position with 15.6% of its assets. IVV returned 3.6% last week. This popular fund has $73.1 billion AUM and a solid daily average volume of more than 4 million shares. The fund charges just 7 bps in annual fees and has an annual dividend yield of 1.7%.

Vanguard 500 ETFVOO

This fund holds 509 securities in its basket with 18.6% of its assets invested in the top 10 holdings. Just like the above two, Information Technology occupies the top position from a sector look at 20.4% while Financials takes the next position with 16.3% of its assets. VOO returned 3.7% last week. The fund is quite popular with $46.5 billion AUM and a strong daily average volume of more than 2 million shares. The fund charges only 5 bps in annual fees and has an annual dividend yield of 2.1%.

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SPDR-SP 500 TR (SPY): ETF Research Reports

SPDR-FINL SELS (XLF): ETF Research Reports

SPDR-FS SELS (XLFS): ETF Research Reports

SPDR-EGY SELS (XLE): ETF Research Reports

VANGD-SP5 ETF (VOO): ETF Research Reports

ISHARS-SP500 (IVV): ETF Research Reports

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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