Investors returned from a long holiday weekend with an optimistic outlook, as news of mega-deals in the food and beverage and insurance industries boosted confidence. IBM delivered solid earnings, further bolstering hopes of a strong year for the technology sector, while investors turned their attention to Massachusetts to evaluate the potential impact of a shifting political landscape on health care reform.
The ETFdb 60 Index, a benchmark measuring the performance of asset classes available through exchange-traded funds, added 7.97 points, or 0.8%, to close at 1,054. The index is already up nearly 2% on the year.
Leading the winners on Tuesday was the iShares FTSE/Xinhua China 25 Index Fund (FXI), which added 3.2% on the day. China has been under intense scrutiny lately as Google has threatened to pull out of the country amidst allegations overzealous censorship and possible human rights abuses. Chinese financials led the surge, recovering from a recent swoon driven by fears that the government would act to rein in spending. The Global X China Financials ETF (CHIX) added 4.4% on the day.
Slumping on Tuesday was the iPath S&P 500 VIX Short-Term Futures ETN (VXX), which lost 5.7% as expectations for equity market volatility in coming months continued to sink. VXX is already down almost 20% on the year, and has lost more than 70% over the last 52 weeks. The VIX is currently trading near 52 week lows as expectations for a smooth first quarter continue to be solidifying among investors.
Disclosure: No positions at time of writing.
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