Semiconductors and Taiwan Lead Friday ETF Surge

Risk appetite was concentrated in the hardware and Asia complex on Friday, with SMH rising 5.1% and EWT gaining 4.6%, extending both funds’ strong three-month advances of more than 26%. Defensive leadership was mixed elsewhere: gold and silver edged higher, while healthcare and communication services lagged in equities, and fixed income posted only modest gains led by EMB and TIP.

Semiconductors soared 5.10%

Equity ETFs

Outperformers: Semiconductors SMH +5.10% (3M perf: +26.6%), Taiwan EWT +4.57% (+26.4%)

Underperformers: Comm. Services XLC -1.58% (3M perf: -0.9%), Healthcare XLV -1.41% (-8.1%)

3M Regime

Strong: South Korea EWY (3M perf: +31.0%), Semiconductors SMH (+26.6%), Taiwan EWT (+26.4%)

Weak: Gold Miners GDX (3M perf: -11.8%), Healthcare XLV (-8.1%), China MCHI (-7.9%)

Signals to Monitor

Volatility Compression: Copper Miners COPX, High Dividend DVY, Brazil EWZ

Overbought: Taiwan EWT, Small-Cap Core IJR, US Technology IYW

EM Sovereign Bonds rose 0.28%

Fixed Income ETFs

Outperformers: EM Sovereign Bonds EMB +0.28% (3M perf: +0.8%), TIPS TIP +0.21% (+1.4%)

Underperformers: Muni Bonds MUB +0.04% (3M perf: +0.6%), Inv. Grade Credit LQD +0.07% (unch.)

3M Regime

Strong: Short TIPS VTIP (3M perf: +1.7%), TIPS TIP (+1.4%), EM Sovereign Bonds EMB (+0.8%)

Weak: Long Treasuries TLT (3M perf: -0.3%), Preferred Stock PFF (-0.1%), Inv. Grade Credit LQD (unch.)

Signals to Monitor

Overbought: Short TIPS VTIP

Oil retreated 1.72%

Alternative ETFs

Outperformers: Silver SLV +0.60% (3M perf: -26.0%), Gold GLD +0.51% (-5.4%)

Underperformers: Oil USO -1.72% (3M perf: +79.0%), Real Estate Sector XLRE -0.30% (+7.0%)

3M Regime

Strong: Oil USO (3M perf: +79.0%), Broad Commodities PDBC (+24.1%), Real Estate Sector XLRE (+7.0%)

Weak: Silver SLV (3M perf: -26.0%), Ethereum Trust ETHA (-21.1%), Bitcoin Trust IBIT (-13.2%)

Signals to Monitor

Volatility Compression: Managed Futures DBMF, Ethereum Trust ETHA, Long/Short Equity FTLS

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.