Daily Movers: South Korea EWY Rose 5.4%

Monday expressed a pro-cyclical rotation. Health Care XLV fell 1.09%, Consumer Staples XLP dropped 1.05%, Real Estate VNQ lost 0.80%, and TLT slipped 0.07%. South Korea EWY rose 5.39%, emerging markets EEM gained 2.85%, Ethereum ETHA climbed 5.37%, and Preferreds PFF added 0.85%. The advance centered on higher-beta equity and crypto exposures. EWY extended a strong 3M uptrend, and EEM did the same. Taiwan EWT and QQQ show vol expansion, Financials XLF and Dow DIA are overbought, and XLE with BNDX are compressed.

Equity: Emerging markets led, defensives lagged

Movers

Leaders: South Korea EWY +5.39% (3M: +54.5%), Emg. Markets EEM +2.85% (3M: +20.0%)

Laggards: Healthcare XLV -1.09% (3M: +10.8%), Consumer Staples XLP -1.05% (3M: +3.4%)

3M Leaderboard

Strong: South Korea EWY +54.5%, Taiwan EWT +51.6%, Technology XLK +35.1%

Weak: Energy XLE -9.7%, Brazil EWZ -8.1%, China Large Cap FXI -8.0%

Fixed Income: Credit income led, duration lagged

Movers

Leaders: Preferred Stock PFF +0.85% (3M: +2.4%), High Yield HYG +0.20% (3M: +1.9%)

Laggards: Long Treasuries TLT -0.07% (3M: -0.4%), Global Bonds BNDX -0.04% (3M: +1.2%)

3M Leaderboard (within FI scale)

Strong: EM Sovereign Bonds EMB +3.8%, Preferred Stock PFF +2.4%, High Yield Bonds JNK +2.1%

Weak: Long Treasuries TLT -0.4%, 7-10yr Treasuries IEF -0.1%, Int. Treasuries VGIT unch.

Specialty: Crypto rallied, real estate lagged

Movers

Leaders: Ethereum Trust ETHA +5.37% (3M: -13.3%), Bitcoin Trust IBIT +3.58% (3M: -4.9%)

Laggards: Real Estate VNQ -0.80% (3M: +8.7%), Global REITs REET -0.46% (3M: +9.7%)

3M Leaderboard

Strong: Semiconductors SMH +54.0%, Momentum Factor MTUM +31.0%, Biotechnology IBB +15.3%

Weak: Gold Miners GDX -16.8%, Ethereum Trust ETHA -13.3%, Gold GLD -11.0%

Notable Setups

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

Equity Volatility Compression: India INDA, Energy XLE

Equity Volatility Expansion: Taiwan EWT, Russell Growth IWF, Nasdaq 100 QQQ

Equity Overbought: Dow Jones DIA, Financials XLF

Fixed Income Reversal setup: 7-10yr Treasuries IEF (vol compression building in 3M underperformers)

Fixed Income Volatility Compression: Aggregate Bonds AGG, Global Bonds BNDX, 7-10yr Treasuries IEF

Specialty Counter-trend rally: Ethereum Trust ETHA (top mover today +5.37%, 3M laggard -13.3%)

Specialty Exhaustion risk: Biotechnology IBB (3M leaders, flashing overbought)

Specialty Volatility Expansion: Long/Short Equity FTLS, Biotechnology IBB, Momentum Factor MTUM

Specialty Overbought: Biotechnology IBB

Cross-Asset Read

Pro-cyclical rotation framed the session across equities, credit, and crypto, with higher-beta exposures bid and duration-sensitive defensives soft. Structural leadership sits with EWY, EWT, XLK, and SMH on the equity side, while EMB, PFF, and JNK lead fixed income; Monday extended the standing 3M advance in EWY, EEM, and PFF, while ETHA rose against a 3M downtrend. Volatility is concentrated in EWT, QQQ, IBB, and MTUM, while XLE, BNDX, and IEF sit in compression and DIA, XLF, and IBB are overbought; the cross-asset regime is pro-cyclical, selective, and led by growth beta rather than defensives.

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.