What just happened?

It’s The Trump Show and we’re just living in it. From the shocking news that the president tested positive for coronavirus and was checked into the Walter Reed National Military Medical Center for three nights, to his proclamation that there would be no fiscal stimulus, to his next-day reversal, President Donald Trump dominated the talk in markets over the past week.

We covered the ups, and the downs, for airline and travel-focused ETFs: a lot of turbulence, you might say. Also, the materials sector started to strengthen, and financials jumped as markets began to price in a Democratic sweep that could boost fiscal spending and reflate yields.

That’s reflected in weekly fund flows, shown at the bottom of this page. Bond funds sold off, but bank funds rallied.

Thanks for reading.

“A fascinating time to be an active manager”

A fund that launched in 2019 is having a terrific 2020. The Hoya Capital Housing ETF
HOMZ
initially branded itself as the only ETF to cover the entire housing market ecosystem, from builders to realtors to REITs to Home Depot. But it was struggling to gather assets. So in August, the fund’s founder, Alex Pettee, rebranded it to more directly compete with the two better-known “homebuilder” ETFs, the SPDR S&P Homebuilders ETF
XHB
and the iShares U.S. Home Construction ETF
ITB,
both of which also are laden with stocks that aren’t homebuilders.

Among ETFs that picked up the most incoming money last month, there was only one actively managed fund in the top 20: ARK Invest’s flagship fund, the Innovation ETF
ARKK.
For all the recent excitement about “semitransparent” ETFs and “active non-transparent” ETFs, ARK’s founder, Cathie Wood, an unabashed and active stock picker, just happens to prefer the transparency that good old-fashioned ETFs provide.

MarketWatch

(Bloomberg) — The dollar extended gains and U.S. equity futures fluctuated as investors weighed the impact of President Donald Trump’s decision to end stimulus talks until after next month’s election. Asian equities were mixed.



chart, line chart: 30-year Treasury yield trying to convincingly break above 200-day moving average


© Bloomberg
30-year Treasury yield trying to convincingly break above 200-day moving average

S&P 500 futures were little changed after the benchmark fell more than 1% overnight. Fresh comments from Trump calling for support for airlines and the Paycheck Protection Program helped reverse earlier losses. Shares saw modest gains in Hong Kong and South Korea and fluctuated in Japan. Treasury yields held overnight declines. Nasdaq contracts earlier retreated after a House panel proposed a series of far-reaching antitrust reforms to curb the power of U.S. technology giants including Amazon.com and Alphabet Inc. European futures pointed lower.

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Elsewhere, Australia’s 3-year bond yield dropped to an all-time low on plans to issue less debt than estimated, while stocks rose after Tuesday’s budget annoucement. Crude oil dropped.

Volatility has picked up this month after Trump contracted the coronavirus and investors weighed the likelihood of a stimulus deal. House Speaker Nancy Pelosi had called on Republicans to get on board with a version of the bill the House passed last week with only Democratic votes. But significant gaps remained between the Democrats’ $2.2 trillion proposal and a $1.6 trillion offer backed by the White House.

“The market rally thus far had really been driven by this unprecedented stimulus from both central banks and governments globally and a large part of that was from the U.S.,” Emily Weis, a macro strategist at State Street Corp., said on Bloomberg TV. The timeline on more American fiscal stimulus “has now been pushed further back.”

Meanwhile, with Trump now out of hospital investors continue to monitor the virus’s impact on economic recoveries

(Bloomberg) — U.S. equity futures fluctuated and Treasuries were steady before a speech by Federal Reserve Chair Jerome Powell on the outlook for the economy.

The Europe Stoxx 600 Index rose, led by gains in banks and travel shares advanced. Hardware maker Logitech International SA slumped as Apple Inc. plans to launch its own audio products and stop selling rival headphones.

The pound weakened after a report that the European Union has no plans to offer concessions to Boris Johnson before next week’s Brexit deadline. The bloc is ready to let U.K. talks drag on into November or December, and even take a chance on Johnson pulling the plug on the deliberations rather than compromise on its red lines, according to a senior EU diplomat.



chart, line chart: Bullion-backed ETF holdings hit record even as spot prices lag


© Bloomberg
Bullion-backed ETF holdings hit record even as spot prices lag

After the S&P 500’s biggest advance in almost four weeks yesterday, investors seem to be taking a break to digest new information. Powell and European Central Bank Chief Economist Philip Lane are set to deliver the keynote addresses at a meeting by the National Association for Business Economics on Tuesday.

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In recent weeks, Fed officials have stressed that the U.S. recovery is highly dependent on the nation’s ability to better contain infections, and that further fiscal stimulus is likely needed to support jobs and incomes.

There are also lingering concerns about the trajectory of the pandemic and its effect on the economy. In Germany, new coronavirus cases jumped the most since mid-April and Italy is set to tighten restrictions to curb the spread of the virus.

“The momentum of the recovery is clearly fading now and the positive surprises have ended,” according to strategists at Dutch asset manager Robeco. “With winter approaching in the northern hemisphere, we are already seeing more

(Bloomberg) — U.S. stocks climbed to a month-week high on optimism over economic stimulus and that President Donald Trump will leave the hospital later Monday. Treasury yields jumped and the dollar weakened.

The S&P 500, Nasdaq Composite and Dow Jones Industrial Average all rebounded from Friday’s swoon in the wake of Trump’s coronavirus disclosure. Regeneron Pharmaceuticals Inc. rallied after Trump was given an experimental antibody treatment made by the drugmaker. Energy, health care and technology shares were the biggest gainers in the S&P.

“Fiscal stimulus continues to be a wild card for the market, and uncertainty around the health of the president certainly looms large,” said Chris Larkin, managing director of trading and investment product at E*Trade Financial. “So while there’s a lot of noise out there, experienced traders may find bullish opportunities.”



timeline: BlackRock's TLT had its best week of inflows on record


© Bloomberg
BlackRock’s TLT had its best week of inflows on record

Trump said on Twitter that he’ll leave Walter Reed hospital Monday evening after being treated since Friday for Covid-19. With less than a month until Election Day, Trump’s hospitalization has jolted the presidential campaign, forcing him to scrap rallies and other events as polls show him trailing Joe Biden nationally and in swing states.

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On the stimulus front, Trump tweeted from the hospital that a deal needs to get done. House Speaker Nancy Pelosi was optimistic on Friday that a bipartisan stimulus bill can be done.

“Absent of vaccine breakthrough, we’re in an economy that is modestly recovering from the lows of March and April, but it can only go so far,” said Tom Hainlin, national investment strategist at U.S. Bank Wealth Management’s Ascent Private Wealth Group. “Areas of the economy that are susceptible are still feeling the pain. That’s why we need so much stimulus from the Federal Reserve and Congress.”

Traders

CoinDesk 20 Bitcoin Price Index

As bitcoin struggles to hold the $10,700 price range Uniswap’s September volume set records but appears to be declining.

  • Bitcoin (BTC) trading around $10,757 as of 20:00 UTC (4 p.m. ET). Slipping 1% over the previous 24 hours.
  • Bitcoin’s 24-hour range: $10,621-$10,924
  • BTC above its 10-day moving average but below the 50-day, a sideways signal for market technicians.

Bitcoin’s price dropped a couple of hundred dollars as a spate of selling took the world’s oldest cryptocurrency to as low as $10,621 on spot exchanges such as Coinbase, recovering to $10,757 as of press time. 

Katie Stockton, analyst for Fairlead Strategies, says cryptocurrencies like bitcoin are affected by traditional markets, particularly equities, which are considered “risk-off” or liquid assets that can easily be sold during a market slide. 

Related: Bitcoin May Return to Center Stage After Ethereum’s White-Hot Summer

“Bitcoin has been attuned to the day-to-day moves in risk assets, but the end result of the intraday volatility is a consolidation phase on the chart,” said Stockton. “Short-term momentum has improved with equities, so I expect the consolidation to give way to a move that leaves support near $10,000 intact.” 

Global equities markets are weak today, either flat or down:

Michael Gord, chief executive officer of crypto trading firm Global Digital Assets, senses a bearish mood for the crypto markets. “Bitcoin might get over $11,000 for a short period this week, but with a big exchange like KuCoin being hacked over the weekend I expect this week to have a more bearish sentiment with retail investors,” said Gord. “Institutional investors, on the other hand, might be taking this buying opportunity to buy cheaper bitcoin.” 

Read More: KuCoin Maintains Wallet Freeze as Hackers Begin Laundering Stolen Crypto

Related: Regulated US Exchange Gemini Now Offers Confidential Zcash Withdrawals

Several stakeholders in the crypto