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"That's what gets them to a market cap big enough to be of interest. The resulting portfolio is effectively a small cap value fund with upside. Illiquid deletions "Deletions tend to be thinly traded, small cap, illiquid. To be sure, the strategy doesn't work for every stock that falls out of a large cap index. That's roughly the picture we have for deletions," Arnott said.
Persons: Rob Arnott, Stocks, they've, Arnott, Russell, NIXT Organizations: Airlines, Rad Laboratories, Research, American Airlines, Architects
Gold is already near the top of the 2024 range of outcomes projected by BlackRock Investment Institute, for example. Emerging market central banks have about 6% of their FX reserves in gold, and developed markets have about 12%. "Weaponizing dollar-based systems, including SWIFT , has led to more people, more countries specifically — more sovereign wealth funds and central banks — not trusting dollar-based assets as much. ETF flows As central banks have been bidding up gold, smaller investors were selling for much of this year. The VanEck Merk Gold ETF (OUNZ) and the Abrdn Physical Gold Shares ETF (SGOL) are the other funds with at least $100 million in net inflows this year, according to FactSet.
Persons: there's, Robert Minter, Minter, SWIFT, Lauren Goodwin, we're, Chris Verrone Organizations: Federal, Nasdaq, BlackRock Investment Institute, Abrdn, World Gold Council, U.S ., FX, United, Russia, New York Life Investments, MiniShares, Federal Reserve Locations: U.S, Abrdn . Central, Central, United States, Ukraine
Rep. Patrick McHenry, R-N.C., sharply criticized other politicians on Tuesday for making public comments about what the Federal Reserve should do with its interest rate policy. McHenry, the outgoing chair of the House Financial Services Committee, said it was an '"outrage" that some politicians are publicly lobbying the central bank about rate cuts. "Senators that are trying to direct the Fed on rate policy are really demeaning their role. McHenry's comments came one day before the U.S. central bank is widely expected to start cutting interest rates for the first time since 2020. Coming in the middle of a presidential election cycle, the change in Fed policy has stirred speculation as to whether the central bank would be influenced by political considerations.
Persons: Patrick McHenry, Kevin McCarthy, McHenry, , Jerome Powell, Joe Biden, Democratic Sens, Elizabeth Warren of, John Hickenlooper of, Sheldon Whitehouse, Warren, Whitehouse, Trump, Sen, Mike Lee, Trump's Organizations: Rep, U.S, Capitol, Federal, Financial Services, Senators, United, Trump, Democratic, Fed, Republicans, Georgetown University's Psaros, Financial Markets Locations: R, Washington, United States, U.S, Elizabeth Warren of Massachusetts, John Hickenlooper of Colorado, Rhode, Utah
Investors may be better off if November's election ends with neither candidate having enough wiggle room to enact their economic policies, according to Citigroup. "We maintain our ongoing view that either candidate's policy platforms are U.S. equity negative, but notably in a 'sweep' context. We mark the Harris platform as incrementally more negative (-4% to -6%) vs the Trump platform (0% to -4%). A split congress with either candidate mitigates most of the nearer term risk to fair values," the note said. … We continue to reiterate our ongoing concern that the deficit circumstance will move more front and center with investors post election," the Citigroup said.
Persons: Scott Chronert, Kamala Harris, Donald Trump, Harris, mitigates, Trump Organizations: Citigroup, Trump, White Locations: Montana , Nevada , Arizona, Pennsylvania
Taylor Swift performs onstage during "Taylor Swift | The Eras Tour" at Wembley Stadium on August 16, 2024 in London, England. Former president Donald Trump lashed out at pop star Taylor Swift on Sunday, less than a week after the musician endorsed Vice President Kamala Harris. "I hate Taylor Swift!," Trump posted in all caps on Truth Social, the website owned by the Trump Media & Technology Group . She also signed the caption as "childless cat lady," a reference to remarks about Democratic women made by Republican vice presidential nominee JD Vance. Trump had previously shared fake artificial intelligence-generated images on social media that showed Swift and her fans supporting him.
Persons: Taylor Swift, Donald Trump, Kamala Harris, Trump, Swift, Harris, JD Vance Organizations: Wembley, Trump Media & Technology, Democratic, Republican Locations: London, England, Vote.gov
Billionaire investor and hedge fund veteran John Paulson said Friday that he would like to see the Federal Reserve start big with its rate cuts. The central bankers seem to be deciding between a cut of 25 basis points or 50 basis points. One asset class that often rises when the Federal Reserve cuts rate is gold, and Paulson is a longtime bull on the yellow metal. Paulson is a veteran figure in the hedge fund world and is perhaps most famous for betting against the housing market ahead of the 2007 crash. Paulson announced in 2020 that he was converting his hedge fund into a family office.
Persons: John Paulson, Paulson, Donald Trump, Kamala Harris, Treasurys Organizations: Federal Reserve, Paulson, Co, Mines, U.S
The firm launched two high yield ETFs on Thursday, aimed at different sections of the high yield market: the Columbia U.S. High Yield ETF (NJNK) and Columbia Short Duration High Yield ETF (HYSD) . The state of high yield So far this year, high yield debt is outperforming the bond market as a whole. The biggest high yield index ETF, the iShares Broad USD High Yield Corporate Bond ETF (USHY) , has returned 7.2% year to date, compared with 4.9% for the firm's Core U.S. High yield when rates fall When market interest rates go down, the price of long-term bonds tends to rise. Some other recent examples include the BlackRock High Yield ETF (BRHY) and the AB Short Duration High Yield ETF (SYFI) .
Persons: Marc Zeitoun, Zeitoun, Dan DeYoung, Columbia Threadneedle, That's, DeYoung, NJNK, Kris Keller, Keller Organizations: Columbia, Columbia U.S, Federal Reserve, firm's, Aggregate Bond, Morningstar Locations: America, Treasurys, BlackRock
Investors and Wall Street analysts may want to take a closer look at stocks that could be winners under a President Kamala Harris after Tuesday night's debate . National polls showed a tight race heading into the debate, but some now believe Harris could get a bump from her performance. "We expect a near-term bounce towards Vice President Harris following the first debate with former President Trump, but the longer-term impact remains unclear," Raymond James Washington analyst Ed Mills said in a note to clients late Tuesday night. Wolfe Research has a similar list of stocks in an anti-Trump trade basket, including health care stocks like Centene and HCA . Of course, it could be difficult for new Democratic policies to become law even with a Harris win in November, depending on how Congressional races shake out.
Persons: Kamala Harris, Donald Trump, Harris, Trump, Raymond James Washington, Ed Mills, Isaac Boltansky, Daniel Clifton, Strategas, Wolfe, — CNBC's Michael Bloom Organizations: Wall Street, Democrat, Walmart, Raytheon Technologies, Wolfe Research, Trump, UBS, Republicans, Democrats, Eaton Corp, Waste Management Locations: Democratic, Ukraine, Russia
Lauren Goodwin, economist and chief market strategist at New York Life Investments, told CNBC that winning stocks are unlikely to fit neatly within defensive sectors at this point in the economic cycle. Another thing for investors to consider is that some of the traditional defensive sectors have already been on an upswing. Meanwhile, the Consumer Staples Select Sector SPDR Fund (XLP) is up 9%, and Health Care Select Sector SPDR Fund (XLV) is up more than 6%. XLU mountain 2024-07-01 Defensive stocks like consumer staples have performed well in the third quarter. Instead of moving to defensive stocks, investors should focus on looking for ways to lock in higher yields in fixed income before the Federal Reserve begins cutting rates, said Goodwin.
Persons: Lauren Goodwin, Goodwin Organizations: New York Life Investments, CNBC, Consumer, Federal Reserve Locations: U.S
The VanEck Semiconductor ETF (SMH) sank 11.7% in the Labor Day-shortened, four-day trading week. That was its worst week since a 15.2% drop in March 2020, spurred by the Covid lockdown. SMH 3M mountain This semiconductor ETF just had its worst week since 2020. VanEck itself launched a somewhat narrower version of the fund — the VanEck Fabless Semiconductor ETF (SMHX) , with 22 stocks — last month. Looking ahead, investors will likely get updates from several chipmakers next week at the Goldman Sachs Communacopia + Technology Conference.
Persons: it's, Cantor Fitzgerald, CJ Muse, Muse, , Bernstein, Stacy Rasgon, Rasgon, VanEck, Nick Frasse, Frasse, Goldman Sachs, CNBC's Gina Francolla Organizations: VanEck Semiconductor, Labor, Nvidia, Taiwan Semiconductor Manufacturing, Wall Street, SOX, CNBC, Intel, Broadcom, Semiconductor, Technology Conference, Devices Locations: VanEck
The growth was led by leisure and hospitality and health care and social assistance, with each category adding more than 40,000 jobs, according to data from the Bureau of Labor Statistics . The August jobs report came in weaker than expected , and employment growth by different industries showed a mixed bag for the U.S. economy . If private education is included with the health-care group, as some economists do, that category would have grown by 47,000 jobs. Construction was a bright spot, growing by 34,000 jobs, but manufacturing shed 24,000 jobs. The health-care subsector added 31,000 jobs, or about half its average over the prior 12 months, according to the Bureau of Labor Statistics.
Persons: … We're, Betsey Stevenson Organizations: Bureau of Labor Statistics, Department of Labor Locations: U.S
The T-Rex 2X Long Nvidia Daily ETF (NVDX) and Direxion Daily NVDA Bull 2X Shares (NVDU) have also attracted inflows this month and now have more than $1 billion in assets combined. Entering Wednesday, Nvidia was up 159% for the year, and the three leveraged long ETFs had all delivered higher returns. Inverse Nvidia funds also exist, though they have been less popular than their leveraged long counterparts so far. The advent of the single stock funds has come at the same time as the rising demand for short-term options . All three long Nvidia funds have annual expense ratios above 1%.
Persons: Will Rhind, NVDU, there's, Bryan Armour, Scott Acheychek, I've, Acheychek, Rhind, Ed Egilinsky, Egilinsky, Morningstar's Armour, Armour Organizations: Nvidia, North America, Rex Financial Locations: GraniteShares
Investors who want to bet on a continued rebound in U.S. manufacturing should take a look at ETFs that hold stocks across different sectors to capture the theme, according to Bank of America. Traditional sector funds don't do a great job capturing this theme in one basket, so Bank of America prefers ETFs that have a wider scope. Woodard's top ETF pick in the space is the First Trust RBA American Industrial Renaissance ETF (AIRR) . While AIRR has the highest expense ratio of the group, it has the best 5Y risk adjusted returns," the Bank of America note said. Second on Bank of America's list is the Global X US Infrastructure ETF (PAVE) .
Persons: Jared Woodard, " Woodard, AIRR Organizations: Bank of America, Democrats, Trust, Industrial Renaissance, Mueller Industries, Bank of, Global, US Infrastructure ETF, Trane Technologies, United Rentals
More than halfway through the third quarter, many of the biggest commodity ETFs in the United States are in sizable holes. Kathy Kriskey, senior commodities ETF strategist at Invesco, said that oil supply is actually tight at the moment. The commodities slump could be partially due to mechanical factors in the market, such as low trading volumes combined with large commodity trading advisors betting against the sector, Kriskey said. "The price of corn has taken almost three full years from those 2022 spike highs to get back down. And oil, one of the biggest weights in commodity indexes, could see stepped up supply in coming months.
Persons: It's, Ryan Grabinski, Strategas, Kathy Kriskey, Kriskey, Sal Gilbertie, We're, Gilbertie, What's, Jerome Powell, Goldman Sachs, Morgan Stanley, Matijn, — CNBC's Michael Bloom Organizations: Strategy, United States Oil Fund, U.S ., Commodities, 4Q, DB Base Metals Fund Locations: United States, Ukraine, U.S, China
Wall Street traders think next week's earnings report from Nvidia is likely to give the chip stock another boost, according to one interpretation of options market pricing. A Piper Sandler research note on Thursday from Benson Durham and Melissa Turner said short-term options on Nvidia look expensive, but that high cost is tilted toward options that serve as bets the stock will rise. So, expensive NVDA options in general don't connote very much investor angst heading into the release," the Piper Sandler report said. The market optimism about Nvidia extends beyond the immediate period after the earnings report, according to Piper Sandler. The Piper Sandler researchers did not take a fundamental position on Nvidia's earnings report.
Persons: Piper Sandler, Benson Durham, Melissa Turner Organizations: Nvidia, Apple, Microsoft
To start, the major funds that are marketed as "low volatility" or "minimum volatility" have been living up to the label. JPMorgan Asset Management has been a leader in this area, with Equity Premium Income ETF (JEPI) and Nasdaq Equity Premium Income ETF (JEPQ) now holding more than $48 billion in combined assets, according to FactSet. Another area is preferred stock funds. The biggest preferred stock ETF, the iShares Preferred & Income Securities ETF (PFF) , has gained 0.5% in the third quarter, though it has dipped 1.4% over the past month. "And those call features of a growing part of the preferred market has also helped in terms of the rate volatility and the impact."
Persons: Robert Hum, It's, it's, Hum, Yang Tang, John Burrello, Gary Kessler, Dodd Frank, Kessler Organizations: Trust, JPMorgan Asset Management, Nasdaq Equity, Nasdaq, Income Securities ETF, Goldman Sachs Asset Management, Preferred, Hybrid Securities, Federal Reserve Locations: BlackRock
Flutter Entertainment — Shares of the gaming company surged more than 10% after a stronger-than-expected report for the second quarter. The parent company of Fanduel reported $3.61 billion in revenue, topping the $3.40 billion expected by analysts, according to LSEG. Nu Holdings — Shares of the Brazil-based financial firm climbed about 4% after a stronger-than-expected second quarter. Ibotta — The tech stock fell almost 9% after a wider-than-expected loss for the second quarter. Ibotta reported a loss of $1.32 per share, compared with an estimated loss of 85 cents per share, according to LSEG.
Persons: Draftkings, Mercury, Ibotta Organizations: Bloomberg News, Justice Department, Nu Holdings, . Mercury Systems Locations: U.S, Illinois, Brazil
A wild week of trading on Wall Street ended with the S & P 500 back roughly where it started, but the lessons learned by whipsawed investors over those five days could determine what happens next. The S & P 500 had its worst day since 2022 on Monday, and then its best since 2022 on Thursday. But with the S & P 500 ending the week down less than 0.1% in a calm session on Friday, the market seems to have stabilized. .SPX 5D mountain The S & P 500 finished the week nearly flat. And I think that has to do with investors really being a little bit skeptical about some of this equity market volatility."
Persons: Tim Hayes, Ned Davis, Gennadiy Goldberg, didn't, Jeremy Schwartz, Peter Berezin, aren't, Wellington, Frank Gretz, RJ O'Brien, Tom Fitzpatrick, Fitzpatrick Organizations: Wall, Treasury, Ned, Ned Davis Research, TD Securities, CNBC, Japan —, Nikkei, Bank of Japan, BCA Research, Wellington Shields, Associates Locations: Japan
.VIX 5D mountain The VIX is well off its highs from Monday as the stock market tries to claw back its losses. The VIX, often called Wall Street's "fear gauge," reflects expected volatility over the next 30 days based on the price of S & P 500 options. "Excluding the current shock, there have been 39 VIX spikes to above 35 in our empirical analysis since 1999. Market shock of this magnitude happens on average more than once per year, but is unlikely to sustain. The lingering question now is whether the concerns that pushed the market into a cascade of selling are alleviated," Krosby said.
Persons: , Howard Du, yesterday's selloff, Quincy Krosby, Krosby Organizations: Bank of America, LPL
Brokerage firm Charles Schwab is having technical issues on Monday in the middle of a steep sell-off for global equities. "Due to a technical issue, some clients may have difficulty logging in to Schwab platforms," the firm said in a post on its X social media account. Some users were reporting on social media about issues getting into their accounts. Schwab was not the only brokerage firm with social media complaints on Monday. CNBC is reaching out to other companies to see if they are having issues.
Persons: Charles Schwab, Dow, Schwab, Downdetector.com Organizations: Fidelity Investments, CNBC Locations: San Francisco , California, Schwab
Brokerage firm Robinhood announced on Monday evening that it would not offer overnight trading due to an issue with its execution venue. The company said in a post on social media site X that Blue Ocean ATS, the third-party firm that Robinhood works with for round-the-clock trading, has suspended its overnight market. "Robinhood 24 Hour Market's execution venue, Blue Ocean ATS (BOATs), has suspended overnight trading for tonight. It is not clear if the suspension will last beyond early Tuesday morning, or if other brokerage firms that offer overnight trading are affected. Overnight trading is typically limited to the most liquid stocks and ETFs in the market.
Persons: Robinhood, Charles Schwab Organizations: Ocean ATS, Dow Jones
Monday's global stock market sell-off led to calls for the Federal Reserve to step in , but that could prove to be even more trouble for investors. This sell-off is not being driven banking crisis, and an emergency rate cut by the Fed may hurt more than it helps, said Lawrence McDonald, a bestselling author and market risk expert. "If they do that, they weaken the dollar, they actually strengthen the yen, and this whole carry trade gets worse," McDonald said. The " carry trade " mentioned by McDonald and others as a key reason for this sell-off is related to interest rates in Japan. Central banks in the United States and other developed markets have hiked interest rates aggressively in the post-pandemic period to fight inflation.
Persons: Lawrence McDonald, McDonald, Lehman Organizations: Federal Reserve, Bank of Japan, U.S, Fed, Lehman Brothers Locations: Japan, Central, United States
Cash has poured into money market funds since the Federal Reserve began its rate hiking cycle. Short-term debt has been a popular investment over the past few years, and money market funds are a top example. For perspective, there was roughly $4 trillion in total money market funds as of the fourth quarter of 2019, according to the St. Louis Fed . Money market funds hold very short-term debt, and many currently offer a yield above 5%. "Historically, you don't tend to see money market inflows stop or convert to outflows until you get below say 3% on those rates.
Persons: Cash, Louis Fed, Sam Huszczo, Huszczo, Todd Sohn, Ken Brodkowitz, weren't, Brodkowitz, Strategas, Sohn, " Sohn, Callie Cox, Cox Organizations: Federal Reserve, Investment Company Institute, SGH Wealth Management, Federal, Bond, SEC, Gries Financial Partners, Fidelity, Income, Morningstar, US Treasury, Ritholtz Wealth Management, Ritholtz Locations: Detroit , Michigan, BlackRock
Recent economic data has pointed toward inflation data falling back toward the central bank's 2% target, while the unemployment rates has crept up above 4%. Powell said Wednesday that central bankers would be "data dependent, but not data-point dependent" in determining when to cut rates. "I don't know think of the labor market in its current state as a likely source of significant inflationary pressures. So I would not like to see material further cooling in the labor market," Powell said. Powell said Wednesday a potential 50-basis point rate cut is "not something we're thinking about right now."
Persons: Jerome Powell, Powell Organizations: Federal, Fed
Hedge fund manager Bill Ackman is looking to raise $2 billion in the initial public offering of Pershing Square USA, with 40 million shares priced at $50. The Pershing Square USA IPO will be in the form of a closed-end fund, and is expected to hold many of the same positions as Ackman's other vehicles. Pershing Square also has a closed-end fund in Europe, which trades at a discount to its net asset value. At one point, Pershing Square was looking to raise as much as $25 billion, according to the Wall Street Journal and Bloomberg News. (In an unusual circumstance, Pershing Square USA then disclosed the letter in a filing and officially disclaimed it.)
Persons: Bill Ackman, Ackman, Seth Klarman's Baupost Organizations: Pershing, USA, Wall Street Journal, Bloomberg News, Bloomberg Locations: Europe
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