U.S. equities were in for a wild ride last week, as several corporate earnings disappointments were overshadowed by ECB President Draghi’s announcement, expressing the central banks commitment to do whatever it takes to bolster the troubled eurozone region. Although Fed Chairman Bernanke gave no hints at the possibility of the elusive QE3 coming to fruition soon, investors are still clinging to the belief that the U.S. central bank will also be forced into action. The coming week will be chock full of major economic reports as well as several bellwether stocks’ earnings announcements. Below, we outline three ETFs that should see a fair amount of activity during the week ahead [see also ETFs And The LIBOR Scandal].
1. MSCI Germany Index Fund (EWG)
Why EWG Will Be in Focus: With over $2.5 billion in total assets under management and an average daily volume of 4.7 million shares, this fund is arguably one of the best measures of the German equity market. Investors should keep a close eye on EWG this week as Germany’s unemployment data is reported on Tuesday. Thus far, the powerhouse nation has stood resilient amidsts the eurozone’s turmoils, and thus the strength of the nation’s labor market will be a good measure of the health of the local economy.
2. 3x Long 25+ Year Treasury Bond ETN (LBND)
Why LBND Will Be In Focus: This leveraged Treasury bond fund is a powerful tool for investors, offering 3x exposure to Ultra T-Bond Futures, whose underlying assets are U.S. Treasury bonds with a maturity of 25 years or more. LBND’s focus will come in the middle of the week, as the Federal reserve announces its key interest rate decision on Wednesday. Although the rate is expected to stay the same, any deviation may trigger significant swings in this ETF [see also 17 ETFs For Day Traders].
3. CurrencyShares Euro Currency Trust (FXE)
Why FXE Will Be in Focus: ECB President Draghi’s announcement last week that the ECB will do whatever it takes to preserve the common-currency union has investors on high alert this week as the central bank’s rate decision is slated to come on on Thursday. Despite Draghi’s expressed commitment to shore up the eurozone, analysts are still expecting the rate to remain unchanged at 0.75%. Should this result be any different, FXE may see an increased level of activity, as the euro will likely react to any changes in the eurozone’s key interest rate.
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Disclosure: No positions at time of writing.