The Latest News:

  • U.S. stocks weakened Thursday, following worries centered on Espirito Santo Financial Group.
  • “People will shoot first and ask questions later when news like this hits,” Lawrence Creatura, a fund manager at Federated Investors Inc., said in a Bloomberg article. “The concern of an event like this is always determining whether it’s occurring in isolation or whether it’s the first domino. It’s a classic flight to safety across the equity, commodities and bond markets.”
  • Nevertheless, the positive fundamentals in the U.S. economy remain, so the recent bout of volatility is only seen as an excuse to sell off the recent highs.
  • “The reality is that we had a 6% rally in just six weeks, and markets were looking for an excuse to correct. Nothing has changed fundamentally, neither in the U.S., nor in Europe,” Steven Wieting, global chief investment strategist at Citi Private Bank, said in a MarketWatch article. “Rising markets tend to ignore single data points, but in falling markets, fear gets amplified that someone else will sell.”

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Max Chen contributed to this article.