Financial exchange traded funds were Monday’s worst U.S. sector ETF performers with European debt jitters continuing to shake markets while Italian government bonds were again under attack.
Standard & Poor’s on Friday placed many U.S. financial companies on credit watch, saying it could downgrade the sector unless a deal is reached soon on the U.S. debt ceiling.
Wall Street’s “fear index” rallied Monday as uncertainty over the U.S. debt limit further sapped investor sentiment. VelocityShares Daily 2X VIX Short-Term ETN (NYSEArca: TVIX) rose 7%.
ProShares Ultra Silver (NYSEArca: AGQ) was also among the top percentage gainers in ETFs Monday amid a jump in precious metals prices. Gold futures traded above $1,600 an ounce for a new record.
European leaders are meeting this week to try and figure out how to stop the region’s debt crisis from deteriorating further. The trouble is spreading from Greece into larger countries such as Italy and Spain. PowerShares DB Italian Treasury Bond Futures ETN (NYSEArca: ITLY) fell more than 1% on Monday following its recent plunge.
In commodities markets, iPath Cotton ETN (NYSEArca: BAL) fell 5% on Monday as the exchange traded note continues to unwind following cotton’s historic rally.
In ETF industry news, smaller firms are making strides against the ‘big three’ of BlackRock’s iShares, State Street and Vanguard in asset gathering.
Separately, a review of Schwab’s U.S. stock ETFs shows the funds are holding their own against the competition.
PowerShares DB Italian Treasury Bond Futures ETN - (click charts to expand)
iPath Cotton ETN
Charts source: StockCharts.com.