uploads///Performances of the Global ETFs

UK Stock Market Stumbles on Weak Chinese Economic Data

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Sep. 30 2015, Published 10:14 a.m. ET

EWU lost 2.61% in the wake of Chinese economic data

The iShares MSCI United Kingdom ETF (EWU) fell by 2.61% on Monday, September 28. The UK stock market went into the red over the weak Chinese economic data the National Bureau of Statistics released on Monday. According to the report, China’s industrial profit fell by 8.8% in August from a year earlier. The drop was the biggest one for China since 2011. The profits in the coal mining industry fell by 64.9% for the first eight months of this year compared to the corresponding period last year, while the oil and gas industry profit fell by 67.3%, as per the report.

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The graph below shows the impact on the UK stock market as represented by the iShares MSCI United Kingdom ETF (EWU). The graph also shows ETFs with exposure to Chinese and Russian financial securities, represented by the Direxion Daily FTSE China Bull 3X ETF (YINN) and the Direxion Daily Russia Bull 3X ETF (RUSL). YINN fell by 5.56% while RUSL fell by 6.38% on the day.

These statistics were not so good for the US and the UK stock markets, as the developed economies depend on the emerging market countries for trade. This weak data triggered the fall in the commodities prices all around the world, as China is the largest consumer of oil and metals in the world. The affected oil and gas companies were BP (BP), Royal Dutch Shell Class A (RDS.A), and Royal Dutch Shell Class B (RDS.B). The stocks went down by 3.08%, 2.80%, and 2.73%, respectively, on September 28. The mining stock BHP Billiton (BHP) fell by 6.03% on the day, and the Direxion Daily S&P 500 Bull 1.25X ETF (LLSP) dropped by 2.01%.

In the next article, we’ll look at the performances of other UK ADRs.

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