ETF Express: Week Ending 18 August 2023

ETF Express is Global X’s weekly coverage of the latest ETF Market Moves, Thematic Spotlight and Commodity Calls.

  • Short equity funds (BBOZ, BBUS, BEAR, SNAS) topped the performance charts last week as US treasury yields continued to climb, putting pressure on markets. 10-year treasury yields closed at their highest level since 2008 last Thursday, and 30-year treasuries followed suit, closing at their highest since 2011.1
  • Crypto ETFs (CRYP, EBTC, EETH) were similarly affected by rising treasury yields, performing poorly as investors priced in the likelihood of interest rates staying higher for longer. Trading volumes on popular crypto-exchanges have also declined as industry news subsides, making markets more susceptible to volatility.2
  • There were $474 million in reported inflows for the week, and only $256 million in outflows, marking a week of net inflows for the Australian ETF industry.

Download our weekly ETF monitor here.

 

New CATL Battery Cures EV Charge Anxiety

Lithium & Battery Tech

Chinese battery manufacturing giant Contemporary Amperex Technology Co. Ltd. (CATL) has revealed a new electric vehicle (EV) battery pack capable of achieving 400 kilometres of range within 10 minutes of charging, and 700 kilometres on a full charge.3 These impressive performance metrics could address critical weaknesses in the EV industry and motivate more drivers to go electric.

CATL’s new battery cell aptly named Shengxing, which roughly translates to “God-like Travel”, claims to be the world’s first 4C superfast charging LFP (lithium iron phosphate) battery. Breaking this down, 4C means CATL’s new battery can achieve full charge in 15 minutes; and its utilisation of LFPs is an innovative spin on older technologies.4

LFPs are a type of lithium battery that has been available since the 1990s. However, as its energy density and power output were limited in initial tests, researchers quickly pivoted to nickel and manganese variants which are currently the industry standard.5 The only advantages of LFPs were considered to be their longer life cycle and overall stability. CATL’s exceptional breakthrough thrusts LFP technology back into the spotlight, as the advantages of a fast-charging, long-distance capable, yet stable and long-lasting battery is apparent.

The new battery pack is set to be released in early 2024, with a vast array of companies including Tesla, Mercedes-Benz, Hyundai, and Volkswagen in line to gain access.6

Explore lithium and battery tech with ACDC.

 

Copper

Bullish

  • India’s copper imports are anticipated to remain high for at least the next two years due to domestic production constraints as well as significant infrastructure and green energy sector demand.7
  • Chinese copper inventories are nearing critically low levels, according to Goldman Sachs, suggesting that supply constraints could become more influential in driving prices.8

Bearish

  • New data heightened doubts about China’s economic recovery. The plunge in Chinese consumer prices is a worrying signal and makes efforts to stimulate the economy ever more urgent.9

Explore copper opportunities with WIRE.

Lithium

Bullish

  • SQM, the second-largest producer of lithium in the world, is forecasting a positive outlook for the sales of electric vehicles.10
  • The UK Infrastructure Bank announced a €24 million investment in mining company, Cornish Lithium. With this support, Cornwall hopes to become a European lithium hub.11

Bearish

  • Poor macroeconomic conditions in the Chinese economy could translate into low consumer spending for electric automobiles.

Explore lithium and battery tech with ACDC.

Uranium

Bullish

  • Sweden is looking to triple its nuclear power capacity over the next two decades to fulfil rising electricity demand. The government’s power strategy relies on the construction of 10 new nuclear facilities.12
  • Origin Energy is encouraging Australia to reconsider its ban on nuclear power as the nation rushes to replace retiring coal plants with clean energy.13
  • Duke Energy Corp. proposed installing a small nuclear reactor at a North Carolina power plant – ending the facility’s decades-long use of coal.14

Bearish

  • Biden has declared a new national monument near the Grand Canyon that restricts future uranium mining in the area – an effort to protect natural resources.15
  • Electricite de France SA warned it might restrict output at two nuclear reactors from Saturday as a heat wave warms the river water that the plants use for cooling.16

Explore the potential of uranium with ATOM.

 

Forecasts are not guaranteed, and undue reliance should not be placed on them. This information is based on views held by Global X or referenced sources as at 18th August 2023.