ETFdb.com analyzes the search patterns of our visitors each week. By sharing these trends with our readers, we hope to provide insights into what the financial world is concerned about and how to position your portfolio.
Positive earnings, expectations of tax reform, and a synchronized global recovery have materialized into higher commodity and stock prices this month. Although gains have been harder to come by this week, the uptrend remains firm as investors look to end the year on a positive note.
However, standing in their way is the bulk of earnings season, which is expected to continue over the next several weeks. Commodities are also beholden to a myriad of forces from emerging market demand to the newfound strength of the U.S. dollar.
Fund investors made it clear what they were interested in this week, with palladium and the Dow posting triple-digit percentage gains en route to the top-two trending spots. Rounding out the top five are cloud computing, inverse equities and volatility.
To compare the previous week’s article to this week’s edition, check out Trending; Banks and Insurers Push Wall Street to Record Highs.
Palladium Is Booming on Global Growth Optimism
An unlikely commodity has leapfrogged to the top spot in our Trends report. Palladium takes the No. 1 seed in the week ended Oct. 26, with a 239% surge in traffic.
Palladium is riding a wave of momentum that extends all the way back to the start of the year, with investors readily buying the dips in pursuit of the coveted $1,000 mark. Palladium hasn’t reached that milestone in 16 years.
The rare metal is a key commodity in emission filters for gasoline engines. As such, it has capitalized on rising demand for gasoline powered cars – a trend that is expected to persist so long as the global rebound continues. For all the talk about an economic slowdown, China’s insatiable appetite for automobiles continues to grow, with car sales rising 4.3% between January-August, according to the China Association of Automobile Manufacturers.
Palladium is represented by one exchange-traded fund called the ETFS Physical Palladium Shares. It has around $230 million in assets under management.
Dow Jones Extends Its Meteoric Rise
The Dow Jones Industrial Average took second spot on our weekly list with a 139% increase in viewership. The blue-chip index declined 112 points on Thursday, but not before adding 168 points the previous day to yet another record-breaking close.
Dow industrials Caterpillar Inc. (CAT) and 3M Co. (MMM) reported strong quarterly results this week, offering further evidence that investors are looking to earnings for their next move. United Technologies (UTX), another Dow 30 blue chip, also reported better-than-expected results.
The Dow has gained roughly 4.5% month-on-month and is up more than 18% year-to-date.
Are you looking to perform in-depth ETF research? Check out our Education section for timely resources.
Google and Cisco Have Their Heads in the Cloud
Google (GOOG) and Cisco (CSCO) have joined forces in a rare alliance that centers on cloud computing – the groundbreaking technology that has allowed businesses to boost productivity while reducing costs. Investors followed the headlines this week, with ETFdb’s cloud-computing page witnessing a 68% rise in viewership.
On Wednesday, the tech giants announced a plan to help businesses manage software services using their own data centers or via external cloud servers. Through the alliance, Google hopes to benefit from Cisco’s strong foothold of corporate America. In return, Cisco will lean on Google to boost its presence in a market that is increasingly being dominated by Amazon (AMZN).
Although the announcement failed to generate consistent gains for the Cloud Computing ETF FT (SKYY ), the fund has added around 20% this year.
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Inverse Equities Pique Investor Interest
A steep rise in volatility at the start of the week drove investors to our definitive list of inverse equities ETFs. This category saw a 62% rise in traffic over the past five trading sessions.
Funds that seek inverse exposure to major equity benchmarks are known to rise during periods of stock market declines. Although stocks are flying high, some investors are looking to short the market. Clearly, these investors aren’t comfortable with the pace of record-setting gains over the past two months. They may be even less comfortable with Wall Street’s current valuations.
The S&P 500 Short Proshares (SH ) rose to multi-week highs on Wednesday, and appears poised to finish the week in positive territory.
Volatility Makes a Comeback?
Wall Street’s preferred measure of market volatility known as the CBOE VIX rose to fifth place on our weekly list with a 53% bump in traffic. Volatility gained double-digit percentages on Monday, and now trades at six-week highs. Though extremely low by historical standards, the VIX is showing signs of momentum.
The CBOE VIX is inversely related to the S&P 500 Index about three-quarters of the time, making the volatility gauge an accurate proxy for stock market health. The so-called “fear index” is back above 11.00, but well below the historic mean of around 20.00. Interesting to note this week is the VIX’s resilience in the face of new record highs for stocks. This suggests volatility is certainly back in play.
The Bottom Line
October has been a bullish month for U.S. equities, as investors continued to rally behind the Trump administration’s proposed tax reforms. The president is trying to get his tax bill passed before the end of the year. Despite recent budget gains, this could prove to be a difficult task as Republican infighting and Democratic opposition continue to stand in the way.
By analyzing how you, our valued readers, search our property each week, we hope to uncover important trends that will help you understand how the market is behaving so you can fine-tune your investment strategy. At the end of the week, we’ll share these trends, giving you better insight into the relevant market events that will allow you to make more valuable decisions for your portfolio.