While some American’s continued Obama’s victory celebration today, Wall Street certainly made clear who it had voted for as stocks took a sharp nosedive in a post-election sell off. With the re-elected President’s win, concerns over the looming fiscal cliff escalated, leaving investors uncertain about the split Congress coming up with a resolution. To add insult to injury, Euro Zone drama once again reared its ugly head, as concerns over the impact of the crisis on powerhouse Germany came to the forefront after the nation’s industrial production was reported to have declined in September [see also How To Pick The Right ETF Every Time].
In a post-election sell off, all three major U.S. indexes logged in some of the worst declines of the year. The Dow Jones Industrial Average (DIA) closed below the critical 13,000 level, marking its biggest one-day decline in nearly a year. Tech-heavy Nasdaq (QQQ) and the S&P 500 (SPY) plummeted 2.48% and 2.37%, respectively. As concerns over Germany’s crumbling resilience surfaced, European equities closed lower, with the German DAX giving up 2%. In Asia, markets closed mostly unchanged.
Bond ETF Roundup
In response to Obama’s re-election, U.S. Treasury prices jumped today, forcing yields down by the most since June. The looming fiscal cliff remains bond investors’ main concern, with the automatic round of massive spending cuts and tax hikes are to take effect on January 1st.
Commodity ETF Roundup
Following Wall Street’s cue, oil futures tumbled nearly 5% today, declining below $85 per barrel. Meanwhile, gold futures hit 2-week highs earlier in the day, as investors speculated Obama’s victory would contribute to an extension of the Fed’s monetary policy. The yellow metal’s rally fizzled however, as fiscal cliff worries outweighed the central bank’s money printing outlook.
ETF Chart Of The Day #1: XLF
The State Street Financial Select Sector SPDR ETF (XLF) was one of the worst performers today, shedding a whopping 3.34% during the session. Financial equities were hardest hit during today’s post-election sell off, forcing this ETF to gap significantly lower at the open. XLF eventually settled near its low of $15.58 a share [see also Financials Free ETFdb Portfolio].
ETF Chart Of The Day #2: XOP
The State Street SPDR S&P Oil & Gas Exploration & Production ETF (XOP) also endured a rough trading day, shedding 3.78% during the session. Shares of big oil companies like Exxon and Chevron plummeted today alongside crude oil futures. As a result, XOP gapped significantly lower at the open and eventually settled at $52.72 a share [see also Top 5 Global Oil Stocks by Market Cap].
ETF Fun Fact Of The Day
Only five ETFs offer exposure to hospital behemoth HCA Holdings (HCA), which gained 9.44% today after Obama’s victory. The Dynamic Healthcare ETF (PTH) allocates 2.79% of total assets to the stock, while the Health Care AlphaDEX Fund (FXH) gives HCA a 2.57% weighting.
Follow me on Twitter @DPylypczak
Disclosure: No positions at time of writing.