ETF Preview: ETFs, Futures Higher on Hopes for Trump's Tax Reform; Markit Flash Data, Existing Home Sales Still Ahead

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Active broad-market exchange-traded funds in Friday's pre-market session:

SPDR Select Sector Fund - Financial ( XLF ): +0.1%

SPDR S&P 500 ( SPY ): +0.1%

iPath S&P 500 VIX Short Term Futures ETN ( VXX ): -0.2%

iShares MSCI Emerging Index Fund ( EEM ): +0.1%

VanEck Vectors Gold Miners ETF ( GDX ): +0.5%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were firmer. Actively traded PowerShares QQQ (QQQ) was up 0.1%.

U.S. stock futures were in positive territory on renewed hopes that President Donald Trump's plans for a tax reform will push through, but worries over geopolitical issues, particularly the closely watched election in France, continue to overshadow optimism.

Corporate earnings also continued to be in the spotlight, led by gainers General Electric (GE) and Honeywell (HON). Meanwhile, Mattel (MAT) and Schlumberger (SLB) slipped lower.

Looking ahead, the April flash purchasing managers indexes for manufacturing and services will be reported at 9:45 a.m. ET.

And, existing home sales for March will be released at 10 a.m. ET.

Power Play: Industrial

Select Sector SPDR-Industrial (XLI) and other industrial funds Vanguard Industrials (VIS) and iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ) were unchanged in the pre-market session.

General Electric Company (GE) was up 1.1% after it said Q1 GAAP EPS from continuing operations were $0.10, up 233% from the year-ago period. Net earnings were $0.07 per share.The Capital IQ mean for GAAP EPS was $0.13. Non-GAAP EPS was flat at $0.21, topping estimates for $0.17. Total GAAP revenue was $27.7 billion, down 1% from last year but above forecasts for $26.37 billion.

Winners and Losers


Select Financial Sector SPDRs ( XLF ) was up 0.1%. Direxion Daily Financial Bull 3X shares (FAS) was up 0.4% while its bearish counterpart, FAZ, was down 0.2%.

Wells Fargo (WFC) was up 0.3% after the lender reported an expansion of its class-action settlement for retail sales practices, previously announced on March 28, to include any customers who were impacted by sales practice issues as early as May 2002. The bank said the updated settlement will add $32 million to the previous agreement for a total settlement amount of $142 million. Employees of Wells Fargo's Community Bank were found last year to have created as many as two million fake customer bank accounts in order to meet sales quotas. Wells Fargo said expects this settlement to resolve claims in 11 other pending class actions that unauthorized accounts were opened in customers names or that customers were enrolled in products or services without their consent.


Tech funds Technology Select Sector SPDR ETF (XLK), iShares Dow Jones US Technology ETF (IYW), iShares S&P North American Technology ETF (IGM) and iShares S&P North American Technology-Software Index (IGV) were quiet in pre-market trading . SPDR S&P International Technology Sector ETF (IPK) was also flat.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were inactive. (AMZN) was up 0.3% after it said it plans to open three additional fulfillment centers in New Jersey, creating more than 2,500 new, full-time jobs. The new sites will be located in Cranbury Township, Edison and Logan Township. Amazon has grown its fulfillment workforce in the state to more than 13,000 employees since launching operations in the state in 2012.


Dow Jones U.S. Energy Fund (IYE) and Energy Select Sector SPDR (XLE) were flat in pre-market trading.

Schlumberger (SLB) reported Q1 adjusted EPS of $0.25, exactly in line with the Street view as compiled by Capital IQ, through down from $0.40 reported a year earlier. The company reported Q1 revenues of $6.89 billion, below the Street view of $6.98 billion, though above the $6.52 billion reported a year earlier. Schlumberger said it expects 2017 capex outlays to be $2.2 billion.


Crude was up 0.3%. United States Oil Fund (USO) was up 0.1%. Natural gas was up 0.2% while United States Natural Gas Fund (UNG) was inactive.

Gold was up 0.2%. SPDR Gold Trust (GLD) was up 0.2%. Silver was down 0.4% while iShares Silver Trust (SLV) was down 0.3%.


Consumer staples funds Consumer Staples Select Sector SPDR (XLP), Vanguard Consumer Staples ETF (VDC), and iShares Dow Jones US Consumer Goods (IYK) were unchanged.

Consumer Discretionary Select Sector SPDR (XLY) and retail funds SPDR S&P Retail (XRT), PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were also flat.

Mattel (MAT) was down 6.6% after the toy company reported late Thursday Q1 adjusted loss of $0.32 per share, compared with the prior-year period's $0.14 loss per share. Analysts polled by Capital IQ were expecting a loss of $0.17 per share. Revenue was $735.6 million, down from $869.4 million in the same quarter last year. The Street view is for revenue of $793.8 million.

Health Care

Health care funds Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were flat. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was flat.

XBiotech (XBIT) was down 33% after the company said it is not likely to receive European marketing approval for its colorectal treatment antibody when a committee votes in May. The company said the European Medicines Agency rendered a negative trend vote after meeting to discuss the Day 180 list of outstanding issues. The vote means it is unlikely that a positive Committee for Medicinal Products for Human Use opinion will be attained at the formal decision vote and additional steps will need to be taken. The key outstanding issues are related to clinical relevance of the therapy in the indication and quality assurance related matters, the company said.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing , ETFs
Referenced Symbols: XLF , SPY , VXX , EEM , GDX

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