American equity markets started the day on a high note, but were slammed in the early part of trading as a major earthquake once again struck Japan, reigniting fears over the country’s ability to quickly rebuild after the other, larger earthquake that struck the nation a few weeks ago. Stocks managed to fight back after this but still finished the day down across the board; the Dow sank by 17 points while the Nasdaq and S&P 500 also posted modest losses of four and two points respectively. Commodities on the other hand, had a solid day as gold finished at yet another record, plowing through the $1,460/oz. mark, while oil hit a 30-month high, finishing the day above $110 a barrel. Soft commodities were more mixed as coffee and sugar gained, but wheat, rice, and corn, all fell on the day. One of the biggest ETF winners on the day was the iShares MSCI Brazil Index Fund (EWZ) which rose by 0.9% on the day. Strength in some of Brazil’s most important imports, oil and sugar, helped to carry some of the smaller companies on the day as raw materials continue to be an important driver of the emerging country’s economy. The biggest gains, however, came in the banking sector which makes up 17.5% of the fund’s total assets. Two of the fund’s top six components, Itau Unibanco and Banco Bradesco, both gained more than 1.5% on the day helping to carry the fund to strong gains on the day. Despite a rough start to the year, EWZ has come surging back in recent weeks as higher commodity prices and strong sentiment over the country’s banking sector has boosted investor interest in the country. In fact, over the past month, EWZ has gained 6.6%, helping to push the fund back into the green for 2011 [see holdings of EWZ here].
One of the biggest ETF losers in the ETFdb 60 was the United States Natural Gas Fund (UNG) which tumbled by 2.1% in Thursday trading. Today’s losses were largely the result of a bearish storage report that was released by the EIA early in Thursday’s session. Natural gas stocks dropped by just 45 billion cubic feet, less than the 49-53bcf that analysts had expected. Thanks to this lower drawdown and the onset of warmer temperatures across much of the country, traders remain very bearish on the short-term prospects of natural gas, and UNG. Thanks to this, UNG is now down 7.4% over the past week and shows little promise of reversing to gains in the near future [see charts of UNG here].
Disclosure: long EWZ.