Wall Street was downbeat last week as evident from a 0.4% fall in the S&P 500. The down Jones was off 0.1% and the Nasdaq Composite was down 1.3% due to rising rates. The benchmark U.S. treasury yield started the week at 4.17% and closed out the week at 4.30%. The inflation prints (which means the Fed is likely to cut rates in the near term) led to rise in bond yields.
Meanwhile, January retail sales data came in at soft. In January, U.S. retail sales experienced a setback, slipping more than anticipated. The Commerce Department's Census Bureau reported a 0.8% drop in retail sales for the month, down from a 0.4% gain in December and worse than the estimate for a 0.3% drop (per a CNBC article). The drop in sales was caused declines in both auto dealership and gasoline service station receipts (read: 4 ETF Areas to Play Despite Soft January Retail Sales).
On a positive note, although the S&P 500 was down for the week, the index hit an all-time high last week. Bitcoin, the world's largest cryptocurrency, surged past the $52,000 mark for the first time since December 2021. The surge primarily came on the back of the increasing movement of institutional money into the asset class (read: Bitcoin Tops 52,000: 5 ETFs Leading the Rally).
The blockbuster earnings of Coinbase Global COIN also cheered bitcoin investors. The company posted its first quarterly profit in two years, beating on earnings and revenues. Trading volume also surged on a new wave of optimism about digital assets, marking a turning point for the largest U.S. cryptocurrency exchange (read: Coinbase Surges on Blockbuster Q4 Earnings: ETFs to Buy).
The National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI) experienced a notable increase, climbing 4 points to reach 48 in February. This improvement marks the third successive month of positive sentiment in the housing market and represents the highest level of confidence since August 2023.
Against this backdrop, below we highlight a few Winning ETF areas of last week.
Winning ETF Areas
Bitcoin Miners and Blockchain
The superb earnings results of Coinbase Global and rapid participation of institutional investors in bitcoin following approval several bitcoin ETFs boosted the space. GraniteShares 2x Long COIN Daily ETF CONL (up 55.40%) and 2x Bitcoin Strategy ETF BITX (up 18.62%) are two top areas.
Palladium
Palladium-based fund abrdn Physical Palladium Shares ETF PALL added 9.8% last week. Last week, palladium had fallen below platinum for the first time since 2018. But some investors covered their short positions after the volatile metal held above the $900 level, per mining.com.
Rising Rates ETFs
Simplify Interest Rate Hedge ETF PFIX has jumped 5.9% last week as rates rose driven by a spike in inflation. In January, U.S. inflation topped expectations as persistently high shelter prices weighed heavily on consumers. The consumer price index rose by 0.3% for the month (read: 4 Sector ETFs & Stocks to Benefit from Hot Inflation).
On a year-over-year basis, the increase stood at 3.1%, a slight decrease from December's 3.4%. Economists surveyed by Dow Jones had anticipated a monthly increase of 0.2% and an annual gain of 2.9%. However, the actual figures surpassed these expectations, as quoted on CNBC.
Headline month-over-month producer price index (PPI) reached +0.3%, 20 bps higher than the +0.1% expected — in fact, the highest we’ve seen since +0.4% reported in September of last year. Excluding volatile food and energy prices, the core print comes in much hotter, i.e., +0.5% from an anticipated gain of 0.1%, which is the highest prints since the early part of 2022, back when the Fed first started raising interest rates to cool inflation.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week.
Get it free >>abrdn Physical Palladium Shares ETF (PALL): ETF Research Reports
Coinbase Global, Inc. (COIN) : Free Stock Analysis Report
Simplify Interest Rate Hedge ETF (PFIX): ETF Research Reports
GraniteShares 2x Long COIN Daily ETF (CONL): ETF Research Reports
2x Bitcoin Strategy ETF (BITX): ETF Research Reports
To read this article on Zacks.com click here.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
