Daily Movers: South Korea EWY Fell 8.1%

The session took the form of a high-beta unwind, led by South Korea EWY’s 8.12% drop. South Korea EWY fell 8.12%, Semiconductors SMH dropped 5.40%, Momentum MTUM declined 4.30%, and emerging markets EEM lost 2.82%. Communication Services XLC rose 2.44%, Financials XLF gained 2.18%, Ethereum ETHA climbed 2.52%, and Bitcoin IBIT added 2.13%. The move concentrated in prior relative-strength cohorts. Vol stays expanded in Nasdaq 100 QQQ and Technology IYW, and stays compressed in Energy XLE and India INDA.

Equity: U.S. sectors led, EM leaders reversed

Movers

Outperformers: Communication Services XLC +2.44% (3M: -0.7%), Financials XLF +2.18% (3M: +11.3%)

Underperformers: South Korea EWY -8.12% (3M: +50.8%), Emg. Markets EEM -2.82% (3M: +17.7%)

3M Leaderboard

Strong: South Korea EWY +50.8%, Taiwan EWT +49.0%, Technology XLK +39.8%

Weak: Energy XLE -13.2%, China Large Cap FXI -10.3%, Brazil EWZ -10.1%

Fixed Income: Duration came under pressure, short-end held up

Movers

Outperformers: Short TIPS VTIP -0.06% (3M: +0.5%), Preferred Stock PFF -0.07% (3M: +1.9%)

Underperformers: TIPS TIP -1.15% (3M: -0.3%), Long Treasuries TLT -1.04% (3M: -0.2%)

3M Leaderboard (within FI scale)

Strong: EM Sovereign Bonds EMB +3.6%, High Yield Bonds JNK +2.9%, Muni Bonds MUB +1.9%

Weak: 7-10yr Treasuries IEF -0.5%, 3-7yr Treasuries IEI -0.5%, Int. Treasuries VGIT -0.5%

Specialty: Counter-trend crypto rallied, momentum and chips lagged

Movers

Outperformers: Ethereum Trust ETHA +2.52% (3M: -23.0%), Bitcoin Trust IBIT +2.13% (3M: -11.5%)

Underperformers: Semiconductors SMH -5.40% (3M: +61.8%), Momentum Factor MTUM -4.30% (3M: +36.9%)

3M Leaderboard

Strong: Semiconductors SMH +61.8%, Momentum Factor MTUM +36.9%, Infrastructure PAVE +13.7%

Weak: Ethereum Trust ETHA -23.0%, Gold Miners GDX -18.2%, Gold GLD -13.9%

Notable Setups

Equity Trend-break risk: South Korea EWY (top decliner today -8.12%, 3M leader +50.8%)

Equity Reversal setup: Energy XLE (vol compression building in 3M underperformers)

Equity Volatility Compression: India INDA, Energy XLE

Equity Volatility Expansion: Russell Growth IWF, US Technology IYW, Nasdaq 100 QQQ

Equity Overbought: S&P SmallCap Growth SLYG

Fixed Income Volatility Compression: Aggregate Bonds AGG, Global Bonds BNDX, EM Sovereign Bonds EMB

Specialty Counter-trend rally: Ethereum Trust ETHA (top mover today +2.52%, 3M laggard -23.0%)

Specialty Trend-break risk: Semiconductors SMH and Momentum Factor MTUM (today's laggards, 3M leaders)

Specialty Volatility Expansion: Biotechnology IBB, Bitcoin Trust IBIT, Momentum Factor MTUM

Specialty Overbought: Biotechnology IBB

Cross-Asset Read

The high-beta unwind framed the session across equities and specialty exposures, and duration also sold off. Leadership sits with prior three-month winners, led by EWY, EWT, and XLK in equities and by SMH, MTUM, and PAVE in specialty; Wednesday’s declines in EWY, SMH, and MTUM ran counter to those standing uptrends, while XLF extended its +11.3% three-month advance. Volatility sits expanded in QQQ, IYW, IWF, IBB, IBIT, and MTUM, while XLE, INDA, AGG, BNDX, and EMB sit compressed; the cross-asset regime is selective de-risking concentrated in prior relative-strength cohorts.

Romain Gandon
CEO, Quantlake

Disclaimer: This article is for informational and educational purposes only and does not constitute investment advice. Past performance is not indicative of future results.