Daily ETF Roundup: GLD Hits Six Week High, UNG Crushed By Mild Weather

by on November 7, 2011 | ETFs Mentioned:

Today saw markets see-saw back and forth as investors had trouble making up their minds on whether or not the euro-zone was a big enough issue to warrant a sell-off. The day started off rough, but things eventually rebounded, pushing the Dow through the 12,000 mark as the massive index gained 85 points on the day. The S&P 500 gained 7.89 points, but neither index could match the success of gold and oil. The two bellwether commodities saw impressive days as oil fought to finish out at $95.9 per barrel, marking a 1.7% increase on the day. Gold was able to flourish in spite of the hefty volatility seen in major equities, as the metal jumped 2.4% to close out just below $1,800 per ounce [see also Ten Best ETF Performers Over The Last Five Years (Including A Few Surprises)]. 

All eyes were fixed on the euro-zone today, as investor focus has now shifted from Greece to Italy, a country which many feel is next in line to suffer a devastating debt crisis. Rumors have also been swirling of the Italian prime minister stepping down, putting more pressure on a country that has already been making headlines for its fiscal problems. Investors also had the day to chew on Germany’s latest disappointment in Industrial Production in October, which “was the worst in two-and-a-half years” writes Matt Nesto. Below, we outline two of the most notable ETF performances on the day [see also ETF Insider: Bulls Look To Stampede Over Euro Drama].

One of the biggest ETF winners on the day came from the massive SPDR Gold Trust (GLD). As markets started off the day in the red, investors poured into GLD to seek safer grounds. Even as markets began to recover, GLD held its ground on the day as it finished out the day up 2.4%. Now that the ETF is sitting at a six week high, and with gold hovering near the $1,800 per ounce mark, GLD is at a pivotal moment in the year. If the euro-zone fears continue, gold has the potential to skyrocket, but if equities put in another strong month, GLD may have a ways to fall [see also 10 Strange But True Facts About The ETF Industry]. 

One of the biggest ETF losers on the day was the United States Natural Gas Fund LP (UNG). This ETF has long been known for its instability, as natural gas tends to be an extremely volatile commodity. Today’s losses came from warm weather around the Northeast, as the winter months seem to be gently easing citizens into the cold. Over the next six to ten days, that region of the coutry is expected to see temperatures of three to five degrees above the annual average, meaning less demand for heating gas. This combined with rising supplies has put natural gas at a two week low, and sent UNG down 2.5% on the day.

Disclosure: No positions at time of writing.