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5 ETF Areas Stood Strong Amid Last Week's Market Carnage

The S&P 500 Index just witnessed its worst streak since a five-day decline that ended on Feb 22. The index was off 1.69%, the Dow Jones retreated 2.15% and the Nasdaq lost 1.61% last week. The Russell 2000 dropped 2.81% last week. Investors are truly growing more cautious about the rise of delta variant of Covid-19. Moreover, September is a usually weak month for Wall Street.

New cases of COVID-19 jumped 300% over the long Labor Day weekend from the year-ago holiday period, according to a new tally from Johns Hopkins University, as quoted on usanews.com. The resurging cases triggered fears about new lockdowns, which is raising worries regarding the sustainability of economic recovery from the pandemic-led slump.

Meanwhile, the jobs data came in lower than expected. The U.S. economy added 235,000 jobs in August 2021, the lowest in seven months and well below the forecast of 750,000 as a surge in COVID-19 infections probably kept companies from hiring and workers from actively looking for a job (read: Winning ETF Areas Amid Downbeat August Jobs Data).

The consumer confidence in the United States slipped to a six-month low in August. The Conference Board's measure of consumer confidence index stands at 113.8 (the lowest level since February), comparing unfavorably with July’s reading of 125.1. August’s reading also missed the consensus estimate of the metric declining to 124, per a Reuters’ poll.

All these factors weighed on markets and inverse ETFs soared. Still there are some areas that stood ground and gained even in this tough scenario.

ETFs in Focus

Uranium

Northshore Global Uranium Mining ETF URNM – Up 19.56%

Global X Uranium ETF (URA) – Up 14.82%

Uranium price jumped to the highest level since 2015 as Sprott buys up physical supply. Investment firm Sprott Inc. earlier this year launched its Physical Uranium Trust and recently commented on Twitter about how much physical uranium it had been buying, resulting an enormous upside in the commodity. Uranium prices should jump further higher to prompt the restart of production to meet uncovered utility demand after 2023, according to analysts at Raymond James Financial Inc., as quoted on mining.com.

Natural Gas

Ultra Bloomberg Natural Gas ETF BOIL – Up 12.91%

US 12 Month Natural Gas (UNL) – Up 7.81%

Like in most winters, natural gas prices started receiving warmth from the chills this year. We are entering the winter heating season with natural gas storage down about 7.2% from the five-year average. Per EIA, natural gas inventory was 16.8% lesser than the year-ago level (read: Natural Gas ETFs Heat Up on Supply Crunch Ahead of Winter).

Normally, Arctic Chills give life to this commodity every winter. The cold snap boosts electricity demand across the region, putting focus on natural gas. his year too, forecasts of colder-than-expected temperatures in the United States might drive natural gas prices higher. U.S. natural gas futures have now spurted to a seven-year high due to supply crunch heading into the winter-heating season.

Japan

Ultra MSCI Japan ETF EZJ – Up 9.19%

iShares MSCI Japan EW ETF (EWJE) – Up 5.96%

Japan stocks have gained momentum lately on hopes of a stronger government ahead of a ruling party leadership race and a general election in November. The resignation of Prime Minister Yoshihide Suga has prompted the bet that a new leader may come up with a hefty fiscal stimulus. Plus, Japan’s economy returned to life in the second quarter with GDP rising 0.3% on a quarter-over-quarter basis after a 0.9% drop in the first quarter (read: Japan Topix Hits 30-Year High: ETFs to Tap).

Aluminum         

iPatha.B Aluminum Subindex TR ETN JJU – Up 7.88%

Aluminium prices erecently touched their highest levels in a decade on news of a coup in Guinea, the world’s second-biggest producer of raw material bauxite, per Financial Times. Guinean soldiers said lately that they had ousted President Alpha Condé in an apparent military coup, triggering fears about the supply of bauxite needed to make aluminium. Guinea supplies about one-fourth of the world’s bauxite, mostly to China and Russia. Shares of aluminum producers in China and Europe also rallied post this.

Shipping

Breakwave Dry Bulk Shipping ETF BDRY – Up 6.58%

Sonicshares Global Shipping ETF (BOAT) – Up 4.15%

Moderate uptick in global growth and a commodity boom are driving prices of freight rates as demand for shipping is high. Ultra-easy monetary and fiscal policies as well as supply chain issues and higher demand from e-commerce companies are also boosting shipping ETFs.


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ProShares Ultra Bloomberg Natural Gas (BOIL): ETF Research Reports
 
iPath Series B Bloomberg Aluminum Subindex Total Return ETN (JJU): ETF Research Reports
 
ProShares Ultra MSCI Japan (EZJ): ETF Research Reports
 
Breakwave Dry Bulk Shipping ETF (BDRY): ETF Research Reports
 
North Shore Global Uranium Mining ETF (URNM): ETF Research Reports
 
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