July was a record-making month for U.S. equities and stock exchange traded funds, with the S&P 500 breaking a new all-time intraday high on Friday.
Over July, the Dow Jones Industrial Average was up 2.8%, the Nasdaq Composite increased 6.7% and the S&P 500 added 3.5%.
The best performing non-leveraged exchange traded products for the past month include the PureFunds ISE Junior Silver ETF (NYSEArca: SILJ) up 29.9%, SPDR Metals & Mining ETF (NYSEArca: XME) up 26.4% and iShares MSCI Global Silver Miners Fund ETF (NYSEArca: SLVP) up 24.1%.[related_stories]
Silver stocks rebounded along with physical silver, but miners experienced a stronger rally this year after years of heavy selling pressure. Additionally, with the Federal Reserve expected to push off interest rate normalization, especially in a more uncertain post-Brexit world, precious metals along with related miners have been among the best performers this year.
Meanwhile, the broader metals & mining sector, which includes a heavy tilt toward steel producers, has rallied on improved fundamentals in the steel industry. Since March, U.S. steel has been gaining ground when Congress passed a new customs and trade enforcement bill that allowed the Obama administration to take action against Chinese dumping.
On the other end, the worst non-leveraged ETPs of the past month include the AccuShares Spot CBOE VIX Up Shares (NasdaqGM: VXUP) down 70.7%, REX VolMAXX Long VIX Weekly Futures Strategy ETF (BATS: VMAX) down 38.2% and iPath S&P 500 VIX Short Term Futures ETN (NYSEArca: VXX) down 30.1%.
The month of July started off on uncertain footing as investors digested the United Kingdom referendum vote and began positioning for a more volatile post-Brexit environment.
After the government revealed a surge in nonfarm payrolls, the equities market began to gain momentum on the improved underlying strength of the labor market and U.S. economy.
As the Brexit shock fades and improved economic data helps fuel sentiment, investors turned risk-on, fueling the push in U.S. equities through the rest of the month. Additionally, a string of better-than-expected second earnings results helped keep the momentum going.
Even a failed coup attempt in Turkey was not enough global geopolitical risk to topple the bullish run that pushed U.S. equities toward record highs.
Toward the end of July, the equities market was more or less stuck in slow, side ways action, with the Federal Reserve standing pat on interest rates but signaling a potential hike in September due to the strength of the labor market.
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