A tenacious stock market rally finally stumbled on a light-news Tuesday.
The day's core piece of economic data was focused on inflation: The Labor Department said October's producer price index (PPI) was up 0.6% month-over-month, and 8.6% year-over-year – the fastest rate of growth in wholesale prices in more than a decade (though inline with economists' expectations).
"The October report showed continued strength in goods prices, which highlights persisting supply bottleneck issues, despite signs that supply has improved in some sectors," say Barclays economists Pooja Sriram and Blerina Uruçi. "Energy (+4.8%) and core goods (ex food & energy; +0.5%) rose at a strong pace. On the other hand, services PPI increased at a modest 0.2% m/m, similar to September, led by a sharp rebound in transportation and warehousing costs after September's decline. In particular, truck and air transportation costs jumped in October."
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"The October report signals that pipeline price pressures remain firm, especially for goods, which will likely remain a significant driving force for core goods (consumer price index) and (personal consumption expenditures price index) inflation this year," they add.
The Dow Jones Industrial Average suffered a mild setback, declining 0.3% to 36,319 as components including Visa (V, -3.2%) and International Business Machines (IBM, -1.7%) retreated.
Tesla (TSLA, -12.0%) – whose declines accelerated Tuesday after CEO Elon Musk's weekend poll asking whether he should sell 10% of his hefty stock position – proved a significant drag on the other major indexes. The Nasdaq Composite (-0.6% to 15,886) saw its 11-session win streak come to an end, while the S&P 500 (-0.4% to 4,685) was stopped at eight consecutive gains.
Other news in the stock market today:
- The small-cap Russell 2000 also dropped, by 0.6% to 2,427.
- U.S. crude futures improved by another 2.7% to hit $84.25 per barrel.
- Gold futures were higher by 0.2% to settle at $1,830.80.
- The CBOE Volatility Index (VIX) was up 3.5% to 17.82.
- Bitcoin's charge continued, with the cryptocurrency surpassing its previous high of $66,974.77 and rushing above $68,500 before pulling back to $67,313.50 by the afternoon. (Bitcoin trades 24 hours a day; prices reported here are as of 4 p.m. each trading day.)
- PayPal Holdings (PYPL) sank 10.5% following its Monday-evening quarterly report. The company earned an adjusted $1.11 per share that topped expectations for $1.07 per share, but revenues of $6.18 billion were slightly behind the pros' projections for $6.23 billion. More worrisome, however, was fourth-quarter guidance for $6.85 billion to $6.95 billion in revenues and $1.12 per share in adjusted profits, both of which fell under Wall Street's bar. That overshadowed an announcement that its Venmo service could be used as a checkout option on Amazon.com (AMZN) beginning in 2022.
A Bumper Year for ETFs
The exchange-traded fund (ETF) industry is guaranteed to finish 2021 in record fashion.
An all-time high $500 billion was poured into U.S. ETFs in 2020, but ETF inflows this year eclipsed that mark – in July – and have since gone on to hit $720 billion as of the end of October.
Kiplinger highly values actively managed mutual funds that can go above and beyond basic benchmarks, but there's no questioning the core driver behind ETFs' ever-growing popularity. While a few ETFs are actively managed, most are tied to an index, providing simple and typically inexpensive exposure to just about any corner of the market you can think of – from stocks and bonds to commodities and even cryptocurrencies.
However, even within the seemingly straightforward realm of index ETFs, similar-sounding funds can indeed be quite different from one another. Here, we try to separate the wheat from the chaff, highlighting 14 index funds across several categories that stand out thanks to their low fees, smart strategies and ability to outdo their peers.
Kyle Woodley was long PYPL as of this writing and initiated a position in TSLA during Tuesday's session.
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