Major Indexes Struggle
Recent rallies in the major indexes have had a hard time hanging onto their gains lately. ETFs like SPDR® S&P Oil & Gas Exploration & Production ETF (NYSE:XOP), SPDR® S&P Metals and Mining ETF (NYSE:XME) and Utilities Select Sector SPDR® Fund (NYSE:XLU) have been experiencing capital inflows. ETFs such as DIA (30-Industrials), SPY (500-Large Caps), IWM (2000-Small Caps), IYT (Transports), and QQQ (100-Nasdaq Largest Non-Financial) are still struggling and remain in the red. While assets such as XOP (S&P Oil & Gas Exploration & Production), XME (S&P Metals & Mining), and XLU (Utilities) are going through a flourishing period of capital influx.
Precious Metals Soar
Our positions in energy and precious metal ETFs netted us a positive return, while our recent trades in the major stock index ETFs had already booked partial position profits, with the remainder of the positions stopping out for a small break-even profit.
As we experience record inflation numbers reported and central banks raising their lending rates, we are keeping our cash ready and closely monitoring key ETF sectors as compared with the major stock index benchmarks for clues regarding our location within the overall economic cycle
Also recently, positions in energy and precious metal ETFs are having positive performances and major stock index ETFs are faring well. Meanwhile, inflation is reaching record highs across the globe as central banks raise lending rates. Many investors are reconsidering their positions and keeping cash at the ready as they closely monitor key sectors.