Mid-Day ETF Update: ETFs, Stocks Rally But Off Day's Highs Following Downbeat Home Builders Data

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Active broad-market exchange-traded funds at Monday's regular session:

SPDR S&P 500 ( SPY ): +0.9%

iShares MSCI Emerging Markets Index ( EEM ): +1.08%


iPath S&P 500 VIX Short Term Futures ( VXX ): -4.35%

iShares Russell 2000 Index ( IWM )): +0.63%

iShares MSCI Japan ETF ( EWJ ): +0.86%

Broad Market Indicators

Most broad market exchange-traded funds were firmer. Actively traded PowerShares QQQ (QQQ) was up 1.15%.

U.S. stocks rallied Monday but were off session highs following the report that the National Association of Home Builders index rose to 47.0 from 46.0 the month prior but missed forecasts for a 50.0 reading. Earlier gains were prompted by the relatively peaceful outcome of the Crimean referendum - even though preliminary results showed that the region was in favor of reuniting with Russia. The U.S. and European Union will be imposing sanctions on Russia following the vote, which they claim was illegal. Other U.S. economic data were more upbeat - industrial production for February was up 0.6% - the fastest monthly growth rate since August; and manufacturing activity in the New York region also showed some improvement, rising to 5.6 in March from 4.5 in February.

Power Play: Technology

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 higher. SPDR S&P International Technology Sector ETF (IPK) was up 3.87%.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was up 0.88%, and Semiconductor Sector Index Fund (SOXX) was up 1.59%.

In stocks news, Schawk, Inc. (SGK) was up more than 36% and reached a three-year high after the company and Matthews International (MATW) said they had signed a definitive agreement under which MATW will acquire SGK. According to the terms of the transaction, SGK stockholders will receive $11.80 cash and 0.20582 shares of MATW's common stock for each SGK share held. Based on the closing price of MATW's stock on March 14, 2014, the transaction represents an implied price of $20.00 for each SGK share and a total enterprise value of approximately $577 million. The exchange is intended to qualify as a tax-free reorganization on the share portion of the purchase price. The merger is expected to achieve $35 million - $45 million in annual cost-savings synergies and is expected to be accretive to adjusted (non-GAAP) earnings per share in the first full fiscal year following the closing of the transaction, excluding non-recurring transaction-related expenses and costs to achieve synergies. MATW shares are up 2.46%.

Winners and Losers

Financial

Select Financial Sector SPDRs (XLF) was up 0.96%, and near its five-year high. Direxion Daily Financial Bull 3X shares (FAS) was up 2.4%. Its bearish counterpart, FAZ, was down 2.59%.

Among sector news, Bank of America (BAC) was up 1.65% after it said Monday that it authorizes a regular quarterly cash dividend of $18.125 per share on the 7.25% Non-Cumulative Perpetual Convertible Preferred Stock, Series L. The dividend is payable on April 30 to shareholders of record as of April 1. This is maintained from the previous dividend paid to shareholders on Jan. 30.

Energy

Dow Jones U.S. Energy Fund (IYE) and Energy Select Sector SPDR (XLE) were both higher, up 0.28% and 0.23% respectively.

In corporate news, Harvest Natural Resources (HNR) was down 6.45% after the petroleum exploration and production company posted Q4 net loss of $122.7 million, or $3.02 per diluted share, compared with a net loss of $23.1 million, or $0.59 per diluted share, for the Q4 2012. It reported an adjusted net loss of $0.36 per share. The Street expected earnings of $0.10 per share, according to Capital IQ.

Commodities

Crude was down 1.31%; United States Oil Fund (USO) was down 1.32%. Natural gas was up 2.23%; United States Natural Gas Fund (UNG) was up 2.28%.

Gold was down 0.46% and silver was down 0.46%. Among rare metal funds, SPDR Gold Trust (GLD) was down 0.59%; iShares Silver Trust (SLV) was down 0.63%.

Healthcare

Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were in the green. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) was up 1.32%.

In corporate news, STAAR Surgical (STAA) was up 14.38% and hit a new record high after the developer of implantable lenses for the eye said an FDA panel voted in favor of its Visian Toric Implantable Lens, which prompted Canaccord Genuity to upgrade its investment rating on the stock to buy from hold. The company's Visian Toric Implantable Lens, or TICL, received favorable votes to three questions presented to the FDA's Ophthalmic Devices Panel of the Medical Devices Advisory Committee. While making the rating upgrade, Canaccord Genuity also raised its target price on STAA to $20 from $14, saying the thumbs up from the panel "could be [a] start of good things to come."

Consumer

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

Among stocks, Kandi Technologies Group (KNDI) was up some 25% the maker of electrical and all-terrain vehicles as well as go-karts reported an adjusted Q4 profit that more than tripled on a 92% surge in revenue. It swung to a Q4 net loss of $14.7 million, compared with a profit of $2.2 million in the same period a year earlier. Excluding those items, its adjusted net income soared to $4.6 million from $1.3 million a year earlier. No analyst estimates were available for comparison via Capital IQ. Revenue jumped 92% to $50.6 million as EV sales nearly tripled $40.0 million. During the quarter, the company sold 3,568 units of pure electronic vehicles.



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

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This article appears in: Investing , Commodities

Referenced Stocks: SPY , EEM , VXX , IWM , EWJ

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As of 12/17/2014, 03:29 PM


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