5 Top-Performing Leveraged ETFs of Last Week

Last week was a moderate one for Wall Street.The S&P 500, the Dow Jones and the Nasdaq Composite have lost about 0.6%, 0.03% and 0.6%, respectively, past week. Renewed hopes for a coronavirus vaccine and treatments lent support to the markets while slowing retail sales as well as rising unemployment claims made investors’ mood a little somber (read: Why Is This the Right Time to Invest in Low-Volatility ETFs?). 

Moreover, last week was busy with mergers and acquisitions in both tech and healthcare sectors. The Fed has also promised lower rates for longer. Against this backdrop, below we highlight a few sector ETFs that gained the most last week (read: No Rate Hike Until 2023: Here's How to Play With ETFs).

Direxion Daily Small-Cap Bull 3X Shares (TNA– Up 8.2%

Vaccine hopes mean a rally in coronavirus laggards. As AstraZeneca has restarted the British clinical trials of its COVID-19 vaccine, one of the most advanced in development, after receiving a nod from safety watchdogs, cyclical sectors and small-cap stocks gained last week as these were battered in the peak of the crisis (read: Is It Again Time to Shift Focus to Cyclical ETFs?).

Better-than-expected second-quarter earnings results and some upbeat economic indicators led investors to shift their focus to reopening trades like small caps (read: Are Smaller-Cap ETFs Good Bet for September?).

Direxion Daily CSI 300 China A Share Bull 2X Shares (CHAU– Up 7.1%

The bout of positive economic data is strongly suggesting that the world’s second-largest economy — China — is steadily recovering from the coronavirus-led economic slowdown. The country’s August industrial output rose the maximum in eight months, while retail sales increased for the first time in 2020.  No wonder, CHAU which gives twice the exposure to the largest and most-liquid stocks in the Chinese A-share market jumped last week.

Direxion Daily South Korea Bull 3X Shares KORU – Up 7.1%

South Korean stocks have been rising on government support. The government unveiled aggressive spending measures to counter the coronavirus-induced economic loss. Improving manufacturing activity in China also aided the South Korean stocks. South Korea said “it was ready to enhance policy support if the rate of [virus] cases worsen and unveiled plans to boost total spending by 8.5% to a record 555.8 trillion won ($468.92 billion) next year”, as quoted on a source. The news kept the fund steady not only last week, but also throughout September.

Direxion Daily Energy Bull 2X Shares (ERX) – Up 5.9%

Last week, oil prices had the best week since June as the de-facto OPEC leader Saudi Arabia defended the oil market recovery (per Bloombergquint) amid a dull demand outlook in the wake of the coronavirus outbreak. Moreover, the shutting down of U.S. offshore production due to Hurricane Sally and a decline in the U.S. crude and gasoline inventory led to a jump in oil prices.

U.S. crude stocks declined 4.4 million barrels in the last to last week to 496 million barrels, marking their lowest since April, per the U.S. Energy Information Administration, compared with analysts’ expectations of a 1.3 million-barrel rise in a Reuters poll. As a result, ERX recorded notable gains last week.  

ETRACS Monthly Pay 1.5x Leveraged Mortgage REIT ETN (MVRL– Up 5.5%

Low interest rates are boosting demand in the housing market, resulting in an increase in mortgage applications. Record-low mortgage rates have led to increased demand and purchase activities in the real-estate sector and boosted the ETN which tracks the overall performance of mortgage real estate investment trusts (read: Here's Why REIT ETFs are Sizzling With Opportunities).

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Direxion Daily Small Cap Bull 3X Shares (TNA): ETF Research Reports
 
Direxion Daily Energy Bull 2X Shares (ERX): ETF Research Reports
 
Direxion Daily MSCI South Korea Bull 3x Shares (KORU): ETF Research Reports
 
Direxion Daily CSI 300 China A Share Bull 2X Shares (CHAU): ETF Research Reports
 
ETRACS Monthly Pay 1.5x Leveraged Mortgage REIT ETN (MVRL): ETF Research Reports
 
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Zacks Investment Research
 
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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.

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