Despite escalation in U.S.-China trade tensions, emerging market meltdown especially in Turkey and Argentina, and rounds of tech sell-off, global stock indexes ended the third quarter on a positive note. American stocks were the biggest gainers backed by the dual tailwinds of solid corporate earnings and an improving economy. On the other hand, many emerging markets were in the red with China falling into a bear territory during the quarter.
Meanwhile, the fixed income world has been mixed with 10-year Treasury yields traded at above 3% for most of the quarter due to inflationary pressures and faster-than-expected rate hike speculation.
Given this, we have highlighted several zones and their ETFs that have garnered enough investors’ interest while few that have shunned by investors.
U.S. Equities: A Hot Spot
The rounds of upbeat data have bolstered confidence in the U.S. economy, leading to massive inflows to the U.S. equities. In fact, these ETFs dominate the top 10 creation list with Vanguard S&P 500 (VOO – Free Report) and iShares Core S&P 500 ET (IVV – Free Report) leading the way, accumulating nearly $7 billion and $6.1 billion assets, respectively. Both the funds track the S&P 500 Index and have a Zacks ETF Rank #2 (Buy).
Vanguard Value ETF (VTV – Free Report) targeting the value corner of the broad U.S. stock market pulled in $2.7 billion in capital followed by SPDR S&P 500 (SPY – Free Report) with inflows of$2.6 billion. VTV has a Zacks ETF Rank #3 (Hold) while SPY has a Zacks Rank #2. The Zacks Ranked #1 (Strong Buy) PowerShares QQQ Trust QQQ and iShares Core S&P Small Cap ETF (IJR – Free Report) with a Zacks Rank #2 also remained hot, gathering more than $2 billion in AUM each. The former follows the Nasdaq-100 index while the latter targets the small cap segment by tracking the S&P SmallCap 600 Index. Strong dollar and escalating trade war fears has led investor to shift to small cap funds.
