Best Leveraged ETFs of Last Week

Wall Street was upbeat last week with the S&P 500 adding 0.6%, the Dow Jones gaining 1.1% and the Nasdaq advancing 1.4%. The benchmark U.S. treasury yield started the week at 4.63%, hit a high of 4.69% and ended the week at 4.50%. 

The Fed's plan to slower the balance sheet tightening process and the release of downbeat jobs data (which triggered bets over sooner-than-expected rate cuts) dragged down bond yields last week. The U.S. economy added 175,000 jobs in April, well below Wall Street expectations of 240,000. Health care and social assistance led the way with a gain of 87,000 jobs.

Meanwhile, corporate earnings have been bullish with Apple and Amazon coming up with both line beats. The corporate commentaries released throughout the week indicated the importance of AI growth and investments.

Meanwhile, crude oil ETF United States Oil Fund LP USO dropped about 6.2% last week on weak demand growth and less supply worries emanated from the Gaza-Israel peace talk. Higher U.S. crude output too played its role in driving down the price of oil.

Against this backdrop, below we highlight winning leveraged ETFs of last week.

ETF Areas in Focus

Direxion Daily S&P Biotech Bull 3x Shares LABU – Up 24.55%

The U.S. benchmark treasury yield fell sharply last week. This boosted growth stocks and biotech technology. Novel drug launches, likely low rates and potential easy access to funds should buoy the zone in the near term.

Direxion Daily Electric and Autonomous Vehicles Bull 2X Shares EVAV – Up 22.9%

Several electric vehicle stocks have been in sweet spot lately, as EV giant Tesla has surged post earnings. Chinese EV companies Nio and Xpeng have seen strong sales growth in 2024 despite massive price war. Nio stock was up 19% last week. Further, several auto companies are signing deals with Chinese tech companies to facilitate their innovations on AI and "smart cars."

T-Rex 2X Long Apple Daily Target ETF AAPX – Up 16.8%

Apple stock gained 5.8% last week on upbeat earnings. Apple reported robust second-quarter fiscal 2024 results, wherein it beat estimates on both earnings and revenues. The iPhone manufacturer lifted its dividend payments and unveiled a record share buyback program despite the steep decline in iPhone sales.

Apple, which lags behind its peer in adopting AI, is gearing up for significant events that are expected to shape its future trajectory. A media event scheduled for May 7 is anticipated to unveil new iPad models and the annual Worldwide Developers Conference (WWDC), starting Jun 10, is anticipated to provide AI-related announcements and insights into the company's AI strategy.

Direxion Daily FTSE China Bull 3X Shares YINN – Up 16.5%

Despite the Chinese economy's poor performance last year, global investors are returning to its equities this year. Compelling valuation, market restructuring, billions in buybacks, the AI boom and its impact on various industries have been boosting the space, of late. Foreign carmakers are joining hands with Chinese companies operating in artificial intelligence and other smart car technology. China tech ETF CQQQ added 6.4% last week while Alibaba and Baidu gaining about 7% and 8%, respectively.

AdvisorShares MSOS 2x Daily ETF MSOX – Up 14.1%

Shares of cannabis companies surged last week after the U.S. Department of Justice (DoJ) moved to reclassify marijuana as a less dangerous schedule III drug. This indicates a moderate to low risk of physical and psychological dependence. Cannabis firms would stand to gain significantly as they would no longer fall under the purview of Section 280E of the U.S. federal tax code, presenting one of the most notable advantages.

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