Wall Street Stages Largest Jump Since 2020: ETF Winners

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Wall Street showed an astounding rally following the lighter-than-expected inflation data, which fueled hopes that the Federal Reserve might slow down the pace of its interest-rate increases. In fact, the three major indices logged in the biggest one-day rally in two years.

While most of the ETFs gained with the market surge, we have highlighted five funds from different segments that gained double digits. These are ARK Innovation ETF (ARKK - Free Report), Amplify Online Retail ETF (IBUY - Free Report), iShares U.S. Home Construction ETF (ITB - Free Report), Sprott Junior Gold Miners ETF (SGDJ - Free Report) and Invesco WilderHill Clean Energy ETF (PBW - Free Report).

Inflation in the United States moderated somewhat as the consumer price index rose 7.7% annually in October after rising 8.2% at the end of September, while the core consumer price index, which strips out volatile components such as food and energy prices, climbed 6.3% year over year, down from 6.6% in September. The data renewed optimism in the stock market about the Fed‘s possibility of slowing its pace of interest-rate increases in 2023.

The central bank has lifted interest rates six times so far this year with four consecutive rate hikes of 75 bps. The rate hike brings the benchmark interest rate, the federal funds rate, to 3.75-4%, its highest level since 2008. The easing inflation data has sparked new hopes for a smaller hike at the next Fed meeting in December.

The S&P 500 rallied 5.5% — its biggest intraday gain since April 2020 — while the Dow Jones Industrial Average climbed 3.7% — the highest since May 2020. The technology-heavy Nasdaq Composite Index jumped a whopping 7.4% — its sharpest climb since emerging from the pandemic crash in March 2020.

Meanwhile, Treasury yields tumbled following the report, with the 10-year yields dropping below the 4% level and two-year yield showing the steepest decline since 2008.

Let’s dig into the detail of the above-mentioned ETFs:

ARK Innovation ETF (ARKK - Free Report) – Up 14.5%

ARK Innovation ETF is an actively managed fund investing in companies that benefit from the development of new products or services, technological improvements and advancements in scientific research. In total, the fund holds 31 securities in its basket with a concentration on the top three firms.

ARK Innovation ETF has gathered $6.9 billion in its asset base and charges 75 bps in fees per year from investors. It trades in a volume of 24 million shares per day on average.

Amplify Online Retail ETF (IBUY - Free Report) – Up 12.2%

Amplify Online Retail ETF offers global exposure to companies that derive 70% or more revenues from online and virtual retail by tracking the EQM Online Retail Index. IBUY holds 58 stocks in its basket, with none accounting for more than 3% of assets. Amplify Online Retail ETF has the largest allocation in the marketplace and traditional retail at 44% each.

Amplify Online Retail ETF has attracted $182.4 million in its asset base and charges 65 bps in annual fees. IBUY trades in an average daily volume of 32,000 shares.

iShares U.S. Home Construction ETF (ITB - Free Report) – Up 11%

iShares U.S. Home Construction ETF provides exposure to U.S. companies that manufacture residential homes by tracking the Dow Jones U.S. Select Home Construction Index.

With AUM of $1.1 billion, iShares U.S. Home Construction ETF holds a basket of 47 stocks with a heavy concentration on the top two firms. The product charges 39 bps in annual fees and trades in a heavy volume of around 3 million shares a day on average. iShares U.S. Home Construction ETF has a Zacks ETF Rank #4 (Sell) with a High risk outlook.

Sprott Junior Gold Miners ETF (SGDJ - Free Report) - Up 10.2%

Sprott Junior Gold Miners ETF follows the Solactive Junior Gold Miners Custom Factors Index, which measures the performance of junior gold producers with the strongest revenue growth and junior exploration companies with the strongest stock price momentum. It holds 44 stocks in its basket, with Canadian firms making up the largest share at 42.8%, followed by Australia (42%) and Turkey (7.1%).

Sprott Junior Gold Miners ETF has amassed $91.4 million in its asset base and trades in a lower volume of around 20,000 shares a day. It charges 50 bps in annual fees from investors.

Invesco WilderHill Clean Energy ETF (PBW - Free Report) – Up 10.1%

Invesco WilderHill Clean Energy ETF offers exposure to companies that are publicly traded in the United States and engaged in the business of advancement of cleaner energy and conservation. It follows the WilderHill Clean Energy Index and holds 83 stocks in its basket.

Invesco WilderHill Clean Energy ETF has amassed $900.9 million in its asset base and trades in a solid volume of around 475,000 shares a day. It charges investors 62 bps in fees per year.


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