Tuesday was filled with all sorts of good, bad, and ugly news. At home, investors digested a solid earnings report from Wells Fargo, although Citigroup’s quarterly performance came in below expectations, painting a gloomier outlook for the financials sector as a whole. News from overseas was mixed as well; China posted better-than-expected GDP results while Standard & Poor’s cut the credit rating of the European Financial Stability Facility, the region’s bailout fund [see ETF Insider: Euro Woes Weigh On Earnings].
The latest Empire State Factory Index helped to propel equities higher as investors on Wall Street rejoiced over better-than-expected data. New York’s manufacturing index came in at 13.5, blowing past analyst estimates of 11.3, and surpassing last month’s reading of 8.2. Amidst the cornucopia of economic data, U.S. stocks sided with the bulls; the Nasdaq led the way higher with a 0.64% gain on the day, while the S&P 500 lagged behind, inching higher by 0.36%. Equity market euphoria created headwinds for the U.S. dollar and gold took the opportunity to climb higher. Futures prices for the precious yellow metal settled near $1,650 an ounce as the trading session drew to a close.
The PowerShares DB Base Metals Fund (DBB) was one of the best performers, gaining 2.68% on the day, bolstered by encouraging manufacturing data at home as well as robust growth in China. Demand for industrial metals was reignited as investors reacted to China’s latest GDP report, which showed growth of 8.9% in the booming Asian economy, compared to estimates of 8.6% [see Commodity Guru ETFdb Portfolio]. Commodity prices rose higher across the board on Tuesday thanks to weakness in the U.S. dollar.
The United States Natural Gas Fund (UNG) was one of the worst performers, shedding 5.29% on the day. Uncharacteristically warm weather all across the U.S. has been a major headwinds for natural gas prices, which plunged to their lowest levels in nearly a decade on Tuesday. The absence of cold weather has taken its toll on futures prices for the fuel, losing nearly 20% in the past six trading sessions alone [see 25 Ways To Invest In Natural Gas].
Disclosure: No positions at time of writing.