Daily ETF Roundup: Markets Crushed On Black Monday Anniversary

by on October 19, 2012 | ETFs Mentioned:

Another slew of sour earnings reports rocked Wall Street today, forcing stocks to log their worst single day drop in almost four months. Among today’s disappointments were bellwethers Microsoft (MSFT), General Electric (GE), and McDonald’s (MCD), all of whom posted earnings reports that missed the mark. Meanwhile, U.S. existing home sales for the month of September fell slightly more than expected. Across the Atlantic, the seemingly never-ending Spain debacle continued as the President of the debt-ridden country once again emphasized that they aren’t quite ready to take the “bailout plunge”. Apparently Spain can’t seem to decide whether they would rather take a much-needed handout or simply default, leaving many investors understandably frustrated with the unpredictable nation. And to add insult to injury, today marked the 25 year anniversary of the 1987 stock market crash, aptly dubbed Black Monday [see also How To Pick The Right ETF Every Time].

Global Market Overview: Markets Crushed On Black Monday Anniversary

U.S. equities ended sharply lower today, with double digit declines marking the worst one-day drop since June. Tech-heavy Nasdaq (QQQ) came in at the bottom of the barrel, shedding 2.19% as technology laggards pulled down the index. The Dow Jones Industrial Average (DIA) and S&P 500 (SPY) also ended in negative territory, losing 1.52% and 1.66%, respectively, during the session. Bogged down by Spain’s refusal to commit to a bailout, European markets closed broadly lower. In Asia, equities posted gains with Japan’s Nikkei Stock Average rising 0.2% and Hong Kong’s Hang Seng Index advancing 0.2%.

Bond ETF Roundup 

After four days of declines, U.S. Treasuries prices finally rose today. Sour corporate earnings coupled with continuing Euro Zone drama had investors shedding riskier asset classes and flocking back to their favorite safe haven.

Commodity ETF Roundup

With a rather grim outlook for the global economy, commodities closed mostly lower today. Copper along with precious metals posted the biggest losses, while crude oil futures also took a steep dive. 

ETF Chart Of The Day #1: IYW

The iShares Dow Jones U.S. Technology Index Fund (IYW) was one of the worst performers today, shedding 2.35% during the session. Led by disappointing earnings reports from Microsoft, technology shares took a nosedive today, forcing this ETF free fall throughout the day. IYW eventually settled at its low of $71.06 a share [see also TDIV: Where Technology Meets Dividends]. 

ETF Chart Of The Day #2: VXX

The Barclays iPath S&P 500 VIX Short-Term Futures ETN (VXX) had an incredible run today, gaining a whopping 6.42% during the session. Poor earnings data coupled with continuing Spain drama had Wall Street back on the defensive today, forcing the CBOE Volatility Index to spike more than 15% to above 17. After a relatively calm morning, VXX surged higher throughout the day, eventually settling below its high of $35.33 a share [see also Low Volatility ETFdb Portfolio]. 

ETF Fun Fact Of The Day

Chipotle Mexican Grill (CMG), which plummeted 15.01% today after the company announced poor earnings, is given exposure in only two ETFs; the Mid-Cap Growth ETF (VOT) and the Mid-Cap ETF (VO) give the stock a mere 1.05% and 0.52% weighting, respectively. 

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Disclosure: No positions at time of writing.