TLT 2024 Inflows Surge to $8.8B

Investors turn back to tech and semiconductor ETFs ahead of inflation readings

3 Updates 
Mon, August 12, 2024 At 4:34 PM EDT
Sumit Roy | Senior ETF Analyst |

Flows to the iShares Fund Have Rebounded Since April

The bond trade is picking up steam. On Friday, the iShares 20+ Year Treasury Bond ETF (TLT) picked up another $800 million of inflows, according to the latest data from Bloomberg. 

That brings its year-to-date haul up to $8.8 billion. That’s quite a turnaround for a fund that had year-to-date outflows of $680 million as recently as April. 

What's the motivation for the surge of TLT purchases? Do investors believe yields on the 30-year will go meaningfully below 4% (they were last around 4.2%)? Or are they agnostic on the direction of rates and simply hedging their portfolios against a potential economic downturn?

etf.com
Mon, August 12, 2024 At 12:47 AM EDT
DJ Shaw | Finance Reporter |

Transportation and infrastructure funds fall; retail ETF gains ahead of earnings.

Airline-related ETFs declined following JetBlue’s announcement of a $400 million convertible notes sale that caused its shares to plummet 19% Monday afternoon. 

The Themes ETF Trust - Themes Airlines ETF (AIRL) fell 0.5%, while the U.S. Global Jets ETF (JETS) and the SPDR S&P Transportation ETF (XTN) dropped 1.5% and 1.6% respectively.

Infrastructure funds also took a hit after Hawaiian Electric Industries shares plunged 15%. The utility reported a $1.3 billion net loss in the second quarter and lacks a financing plan for a $1.7 billion wildfire settlement payment. The iShares U.S. Infrastructure ETF (IFRA) dropped nearly 1% and the First Trust Small Cap Value AlphaDEX Fund (FYT) fell 1.5%.

The VanEck Retail ETF (RTH) rose 0.3% as major retailers prepare to release second quarter results. Home Depot reports Tuesday, while Walmart’s earnings and July’s retail sales data are due Thursday.    
 

Mon, August 12, 2024 At 11:13 AM EDT
Kristin Myers | SVP Content/EIC |

SOXL, TQQQ, NVDL Among Most Active, Top Gainers Ahead of Key Economic Releases

Investors were risk on again Monday morning ahead of key inflation reading set to be released this week. Semiconductor and tech ETFs were among the most actively traded and some of the top gaining funds in early Monday trading, according to etf.com data. 

SOXL, the Direxion Daily Semiconductor Bull 3X Shares rose nearly 4% with more than 29.5M shares of trading volume. SQQQ, the ProShares UltraPro Short QQQ was the only fund that was more active, as investors dumped out of the fund that bets on the falling price of tech stocks. It's counterpart, TQQQ, the ProShares UltraPro QQQ rose 2%.

QQQ, the tech-heavy Invesco QQQ Trust, edged roughly three quarters of a percentage point higher in early Monday trading. 

NVDL, the GraniteShares 2x Long NVDA Daily ETF was the top gaining fund, soaring more than 10% as investors turned back to the trade that had left them with anxiety in the past few weeks. 

/soxl

SHOC, the Strive U.S. Semiconductor ETF also rose Monday, jumping roughly 2%. 

Broad Markets Struggle as Investors Await Key Inflation Data 

Broad markets continued to struggle Monday as investors wait for key economic releases this week. SPY, the SPDR S&P 500 ETF Trust only rose a third of a percentage point while DIA, the SPDR Dow Jones Industrial Average ETF Trust sat in the red, down about .10%.

The consumer price index (CPI) for July is set to be released on Wednesday. If inflation has continued to cool, investors may become hopeful again that the Federal Reserve will feel comfortable to dole out a rate cut at the September policy meeting.

Currently, investors are forecasting an 100% chance of a September rate cut—but markets seem split on how big it will be. Traders are fairly evenly split between a 25 basis point cut and a 50 basis point cut. The bigger the rate cut, the more potential upside for rate sensitive funds like those that invest in Treasury bonds, or high growth stocks like those in tech.