Stocks are on the brink of witnessing the worst start since 1970, as quoted on Yahoo Finance. Only five times since 1932, the S&P 500 has tumbled 15% or more in the first six months of a year. The S&P 500 is off 17.9% so far this year (as of Jun 24, 2022). The Nasdaq Composite is down 28.2% this year, the Dow Jones has lost 13.3% and the Russell 2000 is off 21.3%.
The year, so far, has been caught up with high inflationary pressure across the world due to supply-chain issues, the Russia-Ukraine war, high energy prices, a commodity super-cycle, a super-hawkish Fed, rising rates across the globe as central banks have been tightening policies to rein in inflation, risk-off trade sentiments and a global market crash.
The S&P 500 and the Nasdaq have entered into correction territory this year, with recessionary fears flaring up. The Fed has started rate hikes and has enacted a 150-bp rise already, which has caused recessionary fears. SPDR Gold Shares GLD is flat this year, while iShares 20+ Year Treasury Bond ETF TLT has lost about 24%.
Against this backdrop, below, we highlight the top ETF stories of the first half that caused the market crash this year.
Russia-Ukraine War & Commodity Rally
The year can be remembered because of the start of the Russia-Ukraine war. Notably, both countries are commodity-rich and the war has sent prices for energy, grains, and metals surging. Elements Rogers International Commodity Index-Energy Total Return ETN RJN and Invesco DB Commodity Index Tracking Fund DBC have gained about 67% and 33%, respectively, this year.
Oil Price Rally
The coronavirus vaccine rollout is gradually helping to control the spread of the outbreak across the globe. This is helping in economic reopening and boosting oil demand. Factors like easing Omicron variant concerns, supply shortages, and geopolitical tensions in Eastern Europe and the Middle East have thus boosted oil prices this year. United States Oil Fund, LP USO has advanced 50% this year and United States Brent Oil Fund LP BNO is up 56%. Invesco Dynamic Energy Exploration & Production ETF PXE has gained 37%.