There was no shortage of news for the first day of the last month of 2009, as GM’s CEO stepped down, the tenuous situation in Dubai continued to play out, and reports of a major deal between GE and Vivendi broke. Despite reports of slowdowns in factory activity and looming job cuts, most benchmarks finished the day sharply higher.
The ETFdb 60 Index, a benchmark measuring the performance of asset classes available through ETFs, added 11.24 points, or 1.1%, to close at 1,027.72. The index is now up 2.8% for the quarter.
Leading the way higher Tuesday was the Market Vectors Gold Miners ETF (GDX), which gained more than 5% as gold prices continued to follow a near vertical trajectory. The SPDR Gold Fund (GLD) added 1.5%, as bullion closed around $1,200 per ounce for the first time. GDX has worked well as a leveraged play on gold prices in recent months, consistently delivering an amplified return on spot prices. Continued worries about inflation, weakness in the dollar, and moves by central banks away from the dollar pushed GDX to a record high.
As hot as gold has been in recent months, natural gas has been just as cold. The United States Natural Gas Fund (UNG) turned in another dismal performance on Tuesday, dropping 1.2%. Natural gas prices have been in freefall in recent sessions as inventories have reached all time highs. On Tuesday, Taiwan’s state-run oil company, CPC Corp., said it would begin exploring potential natural gas fields in Indonesia that could hold 110 billion cubic meters.
Since natural gas remains largely a local commodity – its physical properties make long-distance transportation difficult – the development in Taiwan likely had little impact prices in the U.S. But technological advancements are making trans-Atlantic transport more feasible, as evidenced by the arrival of a massive shipment from the Middle East last month.
Disclosure: No positions at time of writing.