Daily ETF Roundup: UNG Jumps, VXX Falls

by on May 10, 2012 | ETFs Mentioned:

Today’s session was no barn-burner by any means, but at least we got to see major benchmarks finish in positive territory and snap a six day losing streak. The Dow squeezed out gains of 20 points while the S&P 500 jumped by about 0.3%. Markets were lifted upwards by better than expected jobless claims on the day, as investors hope to see hiring pick up for the month of May after a disappointing result for last month. But while stocks were able to conjure up a decent day, commodities faced harsher behavior [see also The Cheapest Actively Managed ETFs].

Unlike equity benchmarks, crude oil was unable to alleviate its own six day losing streak, as the fossil fuel finished just barely down on the day. Analysts and investors are highly speculative as to whether or not the commodity is sitting at a low, or if it has a long ways to go, but it can be said almost with certainty that oil will be volatile in the coming trading sessions. Gold was virtually unchanged for the day, leaving it near its lowest point for the year as the precious metal fell below $1,600, sparking a mound of interest on the Street. Below, we outline two of the most notable ETF performances on the day in order to keep investors up to date with today’s markets [see also How To Make A Play On Crude Oil’s Dip].

One of the biggest ETF winners from Thursday’s trading was the United States Natural Gas Fund LP (UNG) which jumped by 0.7%. UNG’s rise was attributed to today’s weekly EIA natural gas report which showed inventories come in lower than expected. High stockpiles have kept downward pressure on NG prices all year, so a lighter-than-expected inventory means that demand has picked up, rising prices for the underlying contracts and this ETF. Despite UNG gaining some traction in recent sessions, the fund is still down over 30% on the year [see also 25 Ways To Invest In Natural Gas].

One of the worst performing ETFs on the day was the S&P 500 VIX Short-Term Futures ETN (VXX), which sank by more than 3% today. Losses in this volatility fund were spawned by a positive jobs report, as “claims for unemployment benefits declined last week to the lowest level in a month, easing concern that the U.S. labor market is faltering.  First-time claims dropped by 1,000 to 367,000 in the period ended May 5, the Labor Department said today in Washington” write Lorrain Woellert and Timothy R. Homan. Think UNG has had a tough year? VXX has surrendered more than 50% since 2012 opened.

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Disclosure: No positions at time of writing.