ETF Daily Roundup: Markets Rally Prior To Election Results

by on November 6, 2012 | ETFs Mentioned:

Finally it’s here. The 2012 presidential election is upon us, and most people are just excited to be free from the onslaught of political ads and campaigning. The real question is when we will find out the results. If the race is really as close as the media has portrayed, absentee ballots could delay the results considerably, and we could have something of a mess on our hands. Markets will likely have a swift reaction once a winner is announced, and we will have nothing left to do but move on from there [for more ETF news and analysis subscribe to our free newsletter].

Global Market Overview: Markets Rally Prior To Election Results

Markets finished up for the second straight day, as it seemed that investors were bullish that today’s winner will be good for stocks. The S&P 500 (SPY) gained a healthy 0.78% but it was beat out by the Dow Jones (DIA) which jumped by 0.90%. The tech sector finished up, but not to the extent of its equity counterparts as the Nasdaq (QQQ) rose by about 0.90%. The rally was not just limited to the U.S. as a number of ETFs tracking foreign equities also saw a strong rally during today’s session. Assuming a winner is declared tonight, look for markets to be quite active upon tomorrow’s opening.

Bond ETF Roundup

With equities soaring on the day, the fixed income space took a hit, as most major bond ETFs finished the day lower. The lone winner was the SPDR High Yield Bond ETF (JNK) which was able to edge up 0.10% for the day. As for the rest, the equity rally seems to have taken funds from the fixed income space. This could also be speculative bets that whoever wins tomorrow’s election will be bad news for this asset class [see also 101 ETF Lessons Every Financial Advisor Should Learn].

Commodity ETF Roundup

Equities may have rallied, but commodities surged on the day, as general bullishness was able to push most major hard assets higher. Precious metals and energy were among the top performers on a day where the dollar slightly down. Gold and oil should be especially active after the results are announced, as these products tend to attract the most speculative traders.

ETF Chart of the Day #1: USO

Crude oil was one of the best performers on the day, as USO was able to tack on a healthy 3%.  The fund jumped at the open, but its real gains came at midday, when a buying trend caught fire for this futures-based product [see also Crude Oil Guide: Brent Vs. WTI, What’s The Difference?].

ETF Chart of the Day #2: GDX

With gold turning in a nice performance, the gold equity space was able to do the same, as this fund jumped by 1.9% for the day. GDX will more than likely be volatile for the remainder of the week as gold is sure to bounce around after it mulls over who will be our next president.

ETF Fun Fact of The Day

The best performing regional ETFdb portfolio YTD is our Africa-Centric Portfolio; this strategy is up 15.9% thus far on the year.

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