Market Commentary — April 5, 2021

In a holiday-shortened trading week, the S&P 500 made news on Thursday surpassing 4,000 for the first time. Select tech shares rallied last week as well, helped by semis and hardware stocks and a bounce in Facebook. In yet another market reversal, growth shares outpaced value for the first time since January.

There continue to be ripple effects from the previous week’s implosion of the Archegos Capital hedge fund. Having suffered steep losses in holdings of U.S. and Chinese media and internet firms, Archegos was forced to liquidate large positions in other widely held names through discounted “block trades ” that drove those share prices lower.

Also in the fallout, many major global banks that had participated in so-called swap trades with Archegos warned investors they has sustained major losses totaling the billions.

Here is the tally so far: Nomura – $2 billion, Credit Suisse – as much as $5 billion, Mitsubishi UFJ – $300 million, JP Morgan – $10 billion, Mizuho Financial Group – $90 million.

Goldman and Morgan Stanley avoided a material financial impact by sprinting to the exits and Deutsche Bank was also able to de-risk its exposure without incurring significant losses.

And for those discounting investor appetite for technology themes and Cathie Woods’ investment prowess, Ark’s new ETF, the Ark Space Exploration and Innovation Fund (ARXX), attracted $280 million on its debut according to Bloomberg Intelligence.

Never underestimate the power of a smart woman! To infinity and beyond!

Jane Edmondson
CEO and Co-Founder

About

EQM Indexes LLC is a woman-owned firm dedicated to creating and supporting innovative indexes that track growth industries and emerging investment themes. Co-founded by Jane Edmondson, a former Institutional Portfolio Manager with more than 25 years in the investment industry.

Disclosure

The information provided on this page is for illustrative purposes only and is not intended to serve as investment advice. The information provided is as of particular time and subject to change at any time without notice.

It is not possible to invest directly in an index. Exposure to an asset class represented by an index is available through investable instruments based on that index. EQM Indexes does not sponsor, endorse, sell, promote or manage any investment fund or other investment vehicle that is offered by third parties and that seeks to provide an investment return based on the performance of any index. EQM Indexes Indices makes no assurance that investment products based on the Index will accurately track index performance or provide positive investment returns. EQM Indexes is not an investment advisor, and makes no representation regarding the advisability of investing in any such investment fund or other investment vehicle. A decision to invest in any such investment fund or other investment vehicle should not be made in reliance on any of the statements set forth in this article. Prospective investors are advised to make an investment in any such fund or other vehicle only after carefully considering the risks associated with investing in such funds, as detailed in an offering memorandum or similar document that is prepared by or on behalf of the issuer of the investment fund or other vehicle. Inclusion of a security within an index is not a recommendation by EQM Indexes to buy, sell, or hold such security, nor is it considered to be investment advice.