Monday, June 1, 2020

Re-Opening on the Horizon

Monday, June 1, 2020 - After another mixed week in the market, we are starting to see more and more investor optimism over a potential re-opening of the US economy. We saw 3.75% gain this week for the Dow Jones Industrial Average, 3.01% gain for the S&P 500, and a 1.77% gain for the Nasdaq Composite. On a 4-day week in the market, Tuesday and Wednesday opened with high gains on news of a potential reopening of the US economy coming soon, aided by positive reports on Covid-19 vaccine/prevention programs. The large gains from these two days were pulled back on Thursday after news of President Trump announcing a response to the escalating US-China tensions after China put stricter security laws into Hong Kong. Friday, President Trump did not mention anything about trade sanctions between the two countries, which ended the week’s close on a stronger note. Overall, the markets approach their highs before the Coronavirus impacted the US economy; edging closer to a potential re-opening can only provide more optimism for investors.

ETFG Quant Movers - We highlight those ETFs with the largest movement in our ETFG Quant Score.

ETFG Quant Winners: The ETFs with the biggest percentage increase in their ETFG Quant Score this week were PNQI, LDRS, JKD, JPLS, and SKYY with 35.71%, 31.29%, 29.12%, 28.52%, and 27.16% gains respectively. What’s worthy to note is that 2nd and 3rd place % Gainers, LDRS and JKD, are two ETFs that seek to track the overall US markets and the largest US Companies, and this may coincide with the overall positive week the US market had.

ETFG Quant Losers: The ETFs with the biggest percentage decrease in their ETFG Quant Score this week were FNDE, PWV, EDIV, QDEF and FDG, with % losses of -25.99%, -20.44%, -20.02%, -19.82%, and -19.80% respectively. The 1st and 3rd biggest losers, FNDE and EDIV, are both emerging markets ETFs, which can be attributed to the tumultuous weeks that emerging markets such as China and Brazil faced.

Lastly, we’ll look at the ETFG Weekly Select List and compare this week’s list to the previous week.

ETFG Weekly Select List - The five most highly rated ETFs per Sector, Geographic Region and Strategy as ranked by the ETFG Quant model.  We highlight the ‘Sector’ Category where we see some of the biggest movers this week include:

· CIBR (First Trust Nasdaq Cybersecurity ETF), which moved from 3rd place to 1st place this week in the ‘Technology’ sub-focus.
· XLF (Financial Select Sector SPDR Fund), which went from unranked the previous week to 1st place this week in the ‘Financials’ sub-focus.
· FXG (First Trust Consumer Staples AlphaDEX Fund), which went from unranked the previous week to 2nd place this week in the ‘Consumer Staples’ sub-focus.

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