Zacks analyst blog spotlights LABU, WEBL and KOLD

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For immediate release

Chicago, IL – June 28, 2022 – Zacks.com announces the list of stocks featured in the analyst blog. Every day, Zacks Equity Research analysts discuss the latest news and events impacting stocks and financial markets. ETFs recently featured in the blog include: S&P Biotech Bull 3X Direxion LABU, DJ Internet Bull 3X Direxion WEBL, Ultrashort Bloomberg Natural Gas ETF KOLD

Here are the highlights from Monday’s analyst blog:

The best performing ETFs of the past week

U.S. stocks took a massive jump in the final trading session last week, with the S&P 500 posting a three-week losing streak as investors digested the latest claims from Federal Reserve officials that they are focus on reducing inflation. The S&P 500 advanced more than 3% on Friday, posting back-to-back days of gains and marking its first weekly advance since late May.

Powell’s assertion that the Fed’s commitment to managing inflation is “unconditional” indicates that the central bank would not stop raising rates if there were modest signs of an economic slowdown or recession. The S&P 500 (up 6.45%), the Dow Jones (up 5.4%), the Nasdaq Composite (up 7.5%) and the Russell 2000 (up 6%) made some nice gains last week.

Cyclical stocks – seen as more vulnerable in a downturn – lagged last week, with the energy sector posting a weekly loss and the materials sector also underperforming. West Texas Intermediate crude oil futures hovered around $107 a barrel and posted their third consecutive weekly loss. The commodity is on its way to the first monthly loss since November.

In big market news, Wall Street’s biggest banks are set to return excess capital to shareholders in the form of dividends and share buybacks after all passing the Federal Reserve’s 2022 stress test. The annual stress tests were established by the Fed, following the 2008 financial crisis, to ensure that banks could withstand any similar shock in the future.

This year, the 34 largest lenders who tested approved the results. The 2022 stress tests point to a jobs slump that drives the unemployment rate above 10% for at least two years, along with a 40% drop in commercial real estate prices. While this year’s scenarios were designed before the Russian-Ukrainian conflict and the current runaway inflation, they indicate banks are well prepared for a potential US recession, which is forecast for later this year or next.

Against this backdrop, we highlight a few leveraged ETFs that have gained massively over the past week below.

S&P Biotech Bull 3X Direxion – Up 69.7%

As the markets rallied, the battered areas retreated faster. Biotechnology is one such area.

DJ Internet Bull 3X Direxion – Up 42.3%

Technology has been one of the biggest losers in recent weeks, as concerns over rising rates have weighed heavily on it. Amid faint signals of market recovery, the tech sector rebounded strongly.

Bloomberg Natural Gas Ultrashort ETF – Up 35.1%

As energy prices have begun to fall after a massive rally, the decline of the leveraged inverse ETF KOLD is evident.

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Past performance is not indicative of future results. The potential for loss is inherent in any investment. This document is provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold any security. No recommendation or advice is given as to whether any investment is suitable for any particular investor. It should not be assumed that investments in the securities, companies, sectors or markets identified and described have been or will be profitable. All information is current as of the date hereof and is subject to change without notice. The views or opinions expressed may not reflect those of the company as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management of securities. These returns come from hypothetical portfolios composed of stocks with Zacks Rank = 1 that have been rebalanced monthly without transaction fees. These are not the returns of actual stock portfolios. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for more information on the performance figures displayed in this press release.

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Direxion Daily S&P Biotech Bull 3X Shares (LABU): ETF Research Reports

ProShares UltraShort Bloomberg Natural Gas (KOLD): ETF Research Reports

Direxion Daily Dow Jones Internet Bull 3X Shares (WEBL): ETF Research Reports

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Zacks Investment Research

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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