OGIG Gains 10% in August as Cloud, AI Stocks Rally

The ALPS O’Shares Global Internet Giants ETF (OGIG) gained 10.7% in August, according to ETF Database. A wave of enterprise cloud and artificial intelligence earnings reports lifted the fund's biggest technology holdings. OGIG climbed 10.69% in August, led by technology holdings. Palantir and Atlassian delivered the fund's biggest individual gains. Chinese internet stocks were the rare drag on returns. Technology stocks did most of the work. The sector's 53% weighting generated an 18.7% return, VettaFi data showed. That translated into a 9.27 percentage point contribution to OGIG's monthly gain. Cloud software and AI companies that make up roughly half the portfolio posted a string of earnings beats through August. Palantir Technologies Inc. (PLTR) was OGIG's largest single contributor for the month, VettaFi data showed. The stock added 1.82 percentage points to the fund's return as shares climbed 51.5%. The gains followed a second-quarter report showing revenue up 93% year over year to $1.94 billion, CNBC reported. U.S. commercial revenue surged 149% to $764 million during the quarter. Atlassian Corp. (TEAM) turned in OGIG's best individual return for August, VettaFi data showed. Shares gained 92.2% for the month, adding 1.19 percentage points to fund performance. Barron's reported that Atlassian shares surged as much as 30% in premarket trading in early August. The gains followed a fiscal fourth-quarter report showing revenue of $1.77 billion, up 28% year over year. Cloud revenue growth accelerated to 31% during the quarter for the maker of Jira and Confluence. Veeva Systems Inc. (VEEV) led gains outside the technology sector, VettaFi data showed. The stock rose 40.2% in August as OGIG's lone healthcare-sector holding, adding 0.42 percentage points to the fund's return. The life sciences software company reported fiscal second-quarter revenue of $928 million, up 18% year over year. Veeva said in its earnings release that net income climbed 37% to $273.4 million during the quarter. Several other cloud computing holdings added to the rally. Shopify Inc. (SHOP) gained 25.8% and ServiceNow Inc. (NOW) rose 33.1% for the month, VettaFi data showed. Oracle Corp. (ORCL) climbed 14.8% and Microsoft Corp. (MSFT) advanced 9.4% over the same period. Combined, the four stocks contributed more than two percentage points to OGIG's monthly return. Not every holding shared in the advance. OGIG's media and communications stocks slipped 1.20% as a group, VettaFi data showed. Declines in Chinese internet names weighed on the sector. Kuaishou Technology dropped 23.1%, Meituan LLC fell 14.7% and Tencent Music Entertainment Group (TME) lost 12.5%, per VettaFi data. Those declines offset gains elsewhere in the portfolio. Airbnb Inc. (ABNB) advanced 20.9% and DoorDash Inc. (DASH) gained 18.1% for the month. OGIGXT, the fund's underlying index, gained just under 10% in August, its second-strongest month of the year, according to VettaFi. Only May's 11.9% return topped it. Combined with July's 5.1% gain, the index's third-quarter return already stands at 15.6%, the strongest quarterly showing of the year so far.