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Biotech & Crypto — Best ETF Areas of Last Week

Wall Street was moderate last week. The S&P 500 (up 0.4%), the Dow Jones (down 0.13%), the Nasdaq (up 2.2%) and the Russell 2000 (up 1.94%) delivered a mixed performance last week. Some segments staged a rebound like technology, clean energy and small-caps.

As the Fed indicated to go slow on future rate hikes, surge in treasury yields got moderated. This has benefitted growth stocks like technology. The small-cap index is now at its cheapest versus the large- cap Russell 1000 since March 2020, according to Jefferies data, giving every reason for bargain-hunting, as quoted on Reuters. Things are taking a turn for the better for the pint-sized stocks as these have less domestic exposure and outperform in a rising greenback environment (read: Small-Cap ETFs: Value Play or Value Trap?).

Clean energy stocks surged lately after Senate Majority Leader Chuck Schumer and Senator Joe Manchin struck an agreement on the Inflation Reduction Act of 2022. This bill aims to boost domestic energy production and reduce carbon emissions (read: Clean Energy Stocks & ETFs Surge on Climate Spending Deal).

Oil prices have dropped sharply from their recent peaks. Against this backdrop, below we highlight the winning ETFs of last week.

ETFs in Focus

Virtus LifeSci Biotech Products ETF BBP – Up 16.8%

Direxion mRNA ETF MSGR – Up 15.2%

ALPS Medical Breakthroughs ETF SBIO – Up 14.4%

SPDR S&P Biotech ETF (XBI) – Up 13.8%

The rally in biotech stocks that started in the middle of June is still in fine fettle. Per FT, hedge funds have started buying beaten-down biotech stocks, since they believe that ultra-cheap valuations could revive M&A activity in the space. Many big pharma companies are looking to boost their drug pipelines through acquisitions (read: Should You Buy Beaten-Down Biotech Stocks & ETFs?).

Biotech stocks were huge beneficiaries of the pandemic as many of these companies were developing new vaccines and treatments for Covid-19, leading to a surge in IPOs and venture capital investments.

Crypto

First Trust SkyBridge Crypto Industry & Digital Economy ETF CRPT – Up 15%

Fidelity Crypto Industry and Digital Payments ETF FDIG – Up 14.2%

ARK Fintech Innovation ETF ARKF – Up 13.4%

VanEck Digital Transformation ETF DAPP – Up 13.2%                                   

Shares of the largest US cryptocurrency exchange jumped as much as 44% on Thursday, the most intraday since its 2021 direct listing, after announcing a partnership with BlackRock Inc. to help institutional investors manage and trade Bitcoin, per Business Standard. The very news bode well for the entire crypto and fintech space.


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ALPS Medical Breakthroughs ETF (SBIO): ETF Research Reports
 
Virtus LifeSci Biotech Products ETF (BBP): ETF Research Reports
 
ARK Fintech Innovation ETF (ARKF): ETF Research Reports
 
VanEck Digital Transformation ETF (DAPP): ETF Research Reports
 
First Trust SkyBridge Crypto Industry and Digital Economy ETF (CRPT): ETF Research Reports
 
Direxion mRNA ETF (MSGR): ETF Research Reports
 
Fidelity Crypto Industry and Digital Payments ETF (FDIG): ETF Research Reports
 
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