After weeks of big price swings and frantic activity in equity markets, a relatively quiet week on Wall Street came to a close with most major indexes posting small losses on the day. A week that saw BP’s chief dragged before Congress, multiple indications of tame inflation, and further seesawing over the outlook for Europe ended with gold touching a record high as investors continued to flock towards safe havens (see Seven ETFs For Investors Mourning The Death Of BP’s Dividend).
The ETFdb 60 Index, a benchmark measuring the performance of asset classes available through ETFs, slid 1.14 points, or 0.1%, in relatively light trading. Only seven index components swung by at least 1% on the day, with most finishing Friday little changed.
The biggest loser on the day was the United States Natural Gas Fund (UNG), which shed 2.3% as a remarkable rally stalled. After steadily plunging for the better part of two years, UNG had gained almost 25% over the last month, a run-up fueled by the combination of warm weather in the U.S., strengthening demand from factories, and predictions of an extremely active hurricane season (see Five Factors Behind UNG’s Spring Rally). After venturing into positive territory on Friday, UNG tumbled in late afternoon trading as commodity investors took profits after the big rise in prices.
Among the biggest winners in Friday trading was the Market Vectors Gold Miners ETF (GDX), which jumped 2.1% on another rise in gold prices. Because the profitability of GDX components depends on the market level for gold bullion, the fund often trades as a leveraged play on spot gold prices. The SPDR Gold Trust (GLD) closed Friday up 0.8% as COMEX gold futures settled at a record high. Gold, a popular safe haven during turbulent economic times, gained ground ahead of bank stress tests in Europe and expectations of a “currency spat” at an upcoming G-20 meeting (see Two Very Different Predictions For The Gold ETF).
Disclosure: No positions at time of writing.