SPAK - Two SPAC ETFs close down signaling a potential end for the market bulls

Two special purpose acquisition company exchange traded funds have closed their doors this month as investors shift their interests away from the SPAC world and more towards traditional safety plays. Market participants are now honed in on the fact that interest rates are set to remain elevated for a sustained period of time.

The Defiance Next Gen SPAC Derived ETF ( NYSEARCA: SPAK ) and the Morgan Creek - Exos SPAC Originated ETF ( SPXZ ) both closed up after trading for less than two years.

At its highest point SPAK had roughly $112M in assets under management and SPXZ amassed $47M at its peak. The two have since liquidated as they were unable keep up with investor interest levels.

SPAC shut downs are just one area that would indicate that the boom on Wall Street is over. Other areas of the market including crypto, meme stocks, and non-profitable tech names have all declined as well and have furthered the case.

The rising rate environment and the continued hawkish tone from Fed Chair Powell has led investors away from the riskier and more speculative SPAC world.

"We need to act now, forthrightly and strong" to avoid the kind of inflation that became embedded in expectations in the 1970s, Federal Reserve Chair Jerome Powell said Thursday in a moderated conversation at the Cato Institute monetary policy conference.

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