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Last week was volatile for Wall Street. While the NVIDIA earnings-led AI boom drove the market in the first part of the week, hawkish Fed minutes tried to take the market in the opposite direction later on. The Dow Jones saw a sharp 600-point drop on Thursday, marking its most substantial loss in more than a year.
Renewed concerns over interest rates triggered Thursday's market turmoil. However, on Friday, Wall Street tried to recoup losses. Overall, the S&P 500 was up 0.03%, the Dow Jones lost 2.3% and the Nasdaq advanced 1.4%.
Shift in Fed Expectations
Stronger-than-anticipated U.S. business data prompted a reassessment of the Federal Reserve's interest rate trajectory, leading to a more divided outlook among traders. Some traders revised its forecast, indicating a delay in the Fed's anticipated rate cut, now targeting September instead of July.
NVIDIA, following an impressive quarterly performance, continued its upward trajectory, rising 13.5% last week to around $1,064 per share. The upcoming stock split for NVIDIA is expected to stimulate further retail investor interest.
Economic Indicators
A revised University of Michigan consumer sentiment index for May was released, showing a reading of 69.1. Despite surpassing expectations, this figure indicated a month-over-month decline, reflecting concerns regarding inflation and interest rates and marking the lowest sentiment level in approximately five months.
T-Rex 2X Long NVIDIA Daily Target ETF (NVDX - Free Report) – Up 30.8%
NVIDIA reported robust financial results for the first quarter last week, surpassing Wall Street expectations with significant increases in both earnings per share and revenue. The company also provided an optimistic outlook for the current quarter, projecting revenue to exceed analysts' estimates.
Nvidia also announced a 10-to-1 stock split and a substantial increase in its quarterly dividend, reflecting confidence in its financial position and future prospects. These measures aim to enhance shareholder value and align with the company's growth trajectory. Shares surged more than 9% on May 23, reacting to the news.
Inverse/Leveraged Real Estate
Direxion Daily Real Estate Bear 3X Shares (DRV - Free Report) – Up 11.7%
The benchmark US treasury yield was started the week at 4.44%, dipped to a weekly low of 4.41%, hit a weekly high of 4.47% and ended the week at 4.46%. Since rates rose last week and the Fed offered hawkish cues, the real estate sector – which performs better in a low-rate environment – underperformed last week.
Inverse/Leveraged Energy
MicroSectors Oil & Gas Exp. & Prod. -3x Inverse Leveraged ETN (OILD - Free Report) – Up 10.9%
The WTI crude ETF – United States Oil Fund LP (USO - Free Report) – dropped 1.6% last week amid hawkish Fed minutes and surge in US stockpiles. Hence, the inverse leveraged energy ETN outperformed last week.
Inverse/Leveraged Gold
MicroSectors Gold -3X Inverse Leveraged ETNs (DULL) – Up 10.8%
Gold bullion lost about 3.5% last week on rising greenback. Higher yields and the U.S. dollar weighed on the bullion ETF and boosted this inverse leveraged gold bullion ETN.
Leveraged Clean Energy
Direxion Daily Global Clean Energy Bull 2X Shares ETF (KLNE - Free Report) – Up 10.3%
Clean energy stocks soared as analysts cited their potential to benefit from big tech companies' investments in artificial intelligence (AI). Analysts have indicated that Microsoft and other hyper-scalers might depend on renewable energy companies to meet AI demand and achieve their carbon neutrality objectives.
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Best Inverse/Leveraged ETF Areas of Last Week
Last week was volatile for Wall Street. While the NVIDIA earnings-led AI boom drove the market in the first part of the week, hawkish Fed minutes tried to take the market in the opposite direction later on. The Dow Jones saw a sharp 600-point drop on Thursday, marking its most substantial loss in more than a year.
Renewed concerns over interest rates triggered Thursday's market turmoil. However, on Friday, Wall Street tried to recoup losses. Overall, the S&P 500 was up 0.03%, the Dow Jones lost 2.3% and the Nasdaq advanced 1.4%.
Shift in Fed Expectations
Stronger-than-anticipated U.S. business data prompted a reassessment of the Federal Reserve's interest rate trajectory, leading to a more divided outlook among traders. Some traders revised its forecast, indicating a delay in the Fed's anticipated rate cut, now targeting September instead of July.
NVIDIA, following an impressive quarterly performance, continued its upward trajectory, rising 13.5% last week to around $1,064 per share. The upcoming stock split for NVIDIA is expected to stimulate further retail investor interest.
Economic Indicators
A revised University of Michigan consumer sentiment index for May was released, showing a reading of 69.1. Despite surpassing expectations, this figure indicated a month-over-month decline, reflecting concerns regarding inflation and interest rates and marking the lowest sentiment level in approximately five months.
NVIDIA-Heavy Leveraged
Direxion Daily NVDA Bull 2X Shares (NVDU - Free Report) – Up 31.1%
T-Rex 2X Long NVIDIA Daily Target ETF (NVDX - Free Report) – Up 30.8%
NVIDIA reported robust financial results for the first quarter last week, surpassing Wall Street expectations with significant increases in both earnings per share and revenue. The company also provided an optimistic outlook for the current quarter, projecting revenue to exceed analysts' estimates.
Nvidia also announced a 10-to-1 stock split and a substantial increase in its quarterly dividend, reflecting confidence in its financial position and future prospects. These measures aim to enhance shareholder value and align with the company's growth trajectory. Shares surged more than 9% on May 23, reacting to the news.
Inverse/Leveraged Real Estate
Direxion Daily Real Estate Bear 3X Shares (DRV - Free Report) – Up 11.7%
The benchmark US treasury yield was started the week at 4.44%, dipped to a weekly low of 4.41%, hit a weekly high of 4.47% and ended the week at 4.46%. Since rates rose last week and the Fed offered hawkish cues, the real estate sector – which performs better in a low-rate environment – underperformed last week.
Inverse/Leveraged Energy
MicroSectors Oil & Gas Exp. & Prod. -3x Inverse Leveraged ETN (OILD - Free Report) – Up 10.9%
The WTI crude ETF – United States Oil Fund LP (USO - Free Report) – dropped 1.6% last week amid hawkish Fed minutes and surge in US stockpiles. Hence, the inverse leveraged energy ETN outperformed last week.
Inverse/Leveraged Gold
MicroSectors Gold -3X Inverse Leveraged ETNs (DULL) – Up 10.8%
Gold bullion lost about 3.5% last week on rising greenback. Higher yields and the U.S. dollar weighed on the bullion ETF and boosted this inverse leveraged gold bullion ETN.
Leveraged Clean Energy
Direxion Daily Global Clean Energy Bull 2X Shares ETF (KLNE - Free Report) – Up 10.3%
Clean energy stocks soared as analysts cited their potential to benefit from big tech companies' investments in artificial intelligence (AI). Analysts have indicated that Microsoft and other hyper-scalers might depend on renewable energy companies to meet AI demand and achieve their carbon neutrality objectives.