U.S. equities could continue to be the beneficiaries of gains as Hong Kong protests start to ease, according to a CNBC report. Hong Kong leader Carrie Lam is said to be close to withdrawing a contentious extradition bill that originally fueled the protests.
“While the initial response to Lam’s speech was a thumbs down, with the main dispute taken off the table things should calm down,” said Peter Boockvar, chief investment officer at Bleakley Advisory Group. “The big picture issues though remain between the two and will only intensify further in coming years as we approach the 2047 handover but for now, move on.”
The positive news comes after the latest U.S. tariffs on Chinese goods went into effect on Sunday, but President Donald Trump said scheduled trade talks set to take place in September are still on the docket. Any sliver of positive news from the trade talks could certainly benefit U.S. equities, which have been sensitive to the latest trade war news.
Trade Tensions Took A Turn
Trade tensions took a turn for the worse last week when both the U.S. and China barraged each other with new tariffs. However, China did soften its stance by saying it’s willing to resolve the trade war with a “calm attitude.”
Investors looking to play the trade wars can look to relative value ETFs that focus on the U.S. and international equities.
For investors who may be sensing continued upside in U.S. equities over international equities, the Direxion FTSE Russell US Over International ETF (NYSEArca: RWUI) offers them the ability to benefit not only from domestic U.S. markets potentially performing well but from their outperformance compared to international markets.
- Seeks investment results, before fees and expenses, that track the Russell 1000®/FTSE All-World ex-US 150/50 Net Spread Index (the “index”).
- The fund, under normal circumstances, invests at least 80% of its net assets (plus borrowing for investment purposes) in securities that comprise the Long Component of the index or shares of exchange-traded funds (“ETFs”) on the Long Component of the index.
- The index measures the performance of a portfolio that has 150% long exposure to the Russell 1000® Index (the “Long Component”) and 50% short exposure to the FTSE All-World ex-US Index (the “Short Component”).
For investors sensing continued upside in U.S. equities over international equities, the Direxion FTSE Russell US Over International ETF (NYSEArca: RWUI) offers them the ability to benefit not only from domestic U.S. markets potentially performing well but from their outperformance compared to international markets.
For more relative market trends, visit our Relative Value Channel.