ETF Preview: ETFs, Futures Inch Higher But Lower Crude Prices, Larger Q1 Trade Deficit Could Undermine Gains

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

SPDR S&P 500 ( SPY ): +0.4%

iPath S&P 500 VIX Short Term Futures ETN ( VXX ): -1.7%

SPDR Select Sector Fund - Financial ( XLF ): +0.4%

iShares MSCI Emerging Index Fund ( EEM ): +0.6%

VanEck Vectors Gold Miners ETF ( GDX ): -0.7%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were mostly in the green. Actively traded PowerShares QQQ (QQQ) was down 0.9%.

U.S. stock futures were on track to open modestly higher as the technology sector is expected to lure in bargain hunters. However, gains were kept in check by a sudden drop in oil prices . Brent crude oil futures stumbled to a five-month low as oversupply pressures continue to weigh on the energy complex amid production gains in Libya.

In economic data news, the U.S. current-account deficit increased 2.5% to $116.8 billion in Q1. The Q4 gap in the current account was raised to $114 billion from the initial reading of $112.4 billion.

Power Play: Energy

Dow Jones U.S. Energy Fund (IYE) was quiet in pre-market trading while Energy Select Sector SPDR (XLE) was up 0.1%.

Cenovus Energy (CVE) was down 1.7% after it said that it expects to grow production annually by 6% through 2021, while also increasing free funds flow by 14%. The company said the plan is to maintain its current oil sands production and add barrels from expansion phase G at Christina Lake, as well as grow volumes at its newly acquired Deep Basin assets. It also plans to achieve an additional $1 billion of cumulative capital, operating and general and administrative cost reductions over the next three years. The company's CEO Brian Ferguson will be retiring in October. The board will immediately start the search for his successor.

Winners and Losers


Select Financial Sector SPDRs ( XLF ) was down 0.5%. Direxion Daily Financial Bull 3X shares (FAS) was down 0.9% while its bearish counterpart, FAZ, was down 0.1%.

Jernigan Capital (JCAP) said that it closed a $10.8 million self-storage development investment commitment in Baltimore, Maryland. The proposed 83,450 net rentable square feet, 993-unit multi-story climate controlled facility will be a conversion of a former textiles office and warehouse. Since January 1, 2017, the company has closed 16 investments in new self-storage projects for an aggregate commitment amount of $186.3 million. Each of these facilities will be managed by CubeSmart upon completion.


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 inactive.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were flat.

Glu Mobile (GLUU) was up 4.3% after it said it has struck a multi-year agreement with World Wrestling Entertainment (WWE) to develop a mobile game featuring WWE Superstars, logos and marks. Glu said its WWE title will include simple, one-touch gameplay mechanics with deep meta game features. The project will use the names and likenesses of many of the organization's most popular legends including The Undertaker, Stone Cold Steve Austin, The Rock and Triple H, as well as current roster of fan-favorites such as John Cena, Roman Reigns and Brock Lesnar. "Glu's previous successes in the casual sports genre make them the perfect developer to bring this project to life," WWE executive vice president Casey Collins said in a statement.


Crude was down 2.3%. United States Oil Fund (USO) was down 2.3%. Natural gas was down 0.03% while United States Natural Gas Fund (UNG) was down 0.6%.

Gold was down 0.02%. SPDR Gold Trust (GLD) was down 0.03%. Silver was down 0.4% while iShares Silver Trust (SLV) was down 0.3%.


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.

Lennar (LEN) was up 2.6% after the provider of real estate related financial services reported fiscal Q2 net profit of $0.91 per share, down from $0.95 per share in the prior year period but higher than the $0.79 earnings per share Street estimate provided by Capital IQ. Revenues for the quarter ended May 31 were $3.26 billion, up from $2.75 billion reported for the same period last year and higher than the $2.90 billion Street estimate.

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.

Novartis AG (NVS) ADRs were up 1.4% after it reported that RTH258 (brolucizumab) 6 mg met its primary and key secondary endpoints in two phase 3 studies, Hawk and Harrier, for patients with neovascular age-related macular degeneration. In both studies, the compound achieved the primary efficacy endpoint of non-inferiority to aflibercept in mean change in best-corrected visual acuity from baseline to week 48. Overall ocular and non-ocular adverse event rates for RTH258 were comparable to aflibercept. The company expects to complete the pharmacokinetic study with the final manufacturing process to enable filing in 2018.

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: SPY , VXX , XLF , EEM , GDX

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