Mid-Day ETF Update: ETFs Extend Gains, Stocks Rally as Obama, Congress Conclude "Constructive" Meeting On 'Fiscal-Cliff'


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Active broad-market exchange-traded funds:

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

Financial Select Sector SPDR ( XLF ): +0.36%

PowerShares QQQ Trust, Series 1 ( QQQ ): +0.45%

iShares MSCI Emerging Markets Index ( EEM ): +0.14%

iShares Russell 2000 Index ( IWM ): +0.4%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM, IVV and others, have held on to modest gains. Actively traded PowerShares QQQ ( QQQ ) is up 0.45%.

U.S. stocks are rallying after both Democratic and Republican congress leaders said their fiscal-cliff meeting with President Obama, had been "constructive." Market sentiment brightened after a week of fiscal-cliff gloom earlier today, when the Wall Street Journal reported the White House was in "advanced discussions" to replace the sequester, or the big spending cuts, with a smaller package. Most analysts and pundits had expected negotiations to be long drawn-out and would keep markets pressured and volatile over the next several weeks; but the new plan could "push larger deficit-reduction talks into the middle of 2013," WSJ added. In economic data, October industrial production and capacity utilization, missed forecasts, with data impacted by Hurricane Andy.

Winners and Losers

Financial -

Select Financial Sector SPDRs ( XLF ) is up 0.33%. Direxion Daily Financial Bull 3X shares (FAS) is up 1.4%. Its bearish counterpart, FAZ, is down 1.5%.

Among financial stocks, Home Loan Servicing Solutions (HLSS) is up 7% after it said yesterday that it has revised its Q4 guidance, now expecting earnings to be $0.40 - $0.41 per share. Analysts polled by Capital IQ are expecting EPS of $0.39. In addition, the company said its board of directors increased the dividend for the months of November and December 2012 by $0.01 to $0.12 per ordinary share. The November dividend will be paid to shareholders of record as of Nov. 30, 2012 on Dec. 10, 2012. The December dividend will be paid to shareholders of record as of Dec. 31, 2012 on Jan. 10, 2013. HLSS shares were also raised to Buy from Hold at Deutsche Bank. The firm has a $19.25 price target on the stock.

Technology -

Tech ETFs are mixed: Technology Select Sector SPDR ETF (XLK) flat; iShares Dow Jones US Technology ETF (IYW), up 0.13%; iShares S&P North American Technology ETF (IGM), down 0.76%; and iShares S&P North American Technology-Software Index (IGV), up 0.61%.

SPDR S&P Semiconductor (XSD) is down 0.05%; and Semiconductor Sector Index Fund (SOXX) has turned negative. SPDR S&P International Technology Sector ETF (IPK) too has turned negative.

In sector news, Dell (DELL) is down 7% and has hit a new 52-week low of $8.69 after reporting late Thursday Q3 revenue of $13.7 bln, below the analyst consensus of $13.89 bln on Capital IQ. EPS was $0.39, vs. expectations of $0.40 per share. The company expects sequential revenue growth of 2% to 5%. Dell maintains its expectation for at least $1.70 in earnings per share on a non-GAAP basis. The Street is at $1.73 per share.

Energy -

Dow Jones U.S. Energy Fund (IYE) is now slightly lower; As is the Energy Select Sector SPDR (XLE).

In sector news, Targa Resources Partners (NGLS) is down 1.3%. Late Thursday, the partnership announced that it has priced an underwritten public offering of 9.5 mln common units representing limited partner interests at $36.00 per common unit. The Partnership also granted the underwriters a 30-day option to purchase up to 1.425 additional common units. The offering is expected to close on or about November 21, 2012.

Commodities -

Crude was up 1.26%; natural gas was up 1.49%. United States Oil Fund (USO) is up 1.17%. United States Natural Gas Fund (UNG) is up 2.2%.

Gold was up 0.01% while silver was down 0.92% respectively. Among rare metal funds, SPDR Gold Trust (GLD) is now slightly higher; iShares Silver Trust (SLV) is down 0.48%.

Retail -

Retail ETFs are mostly in the green: SPDR S&P Retail (XRT), up 0.1%; PowerShares Dynamic Retail (PMR), down 0.33%; and Market Vectors Retail ETF (RTH), up 0.4%, with a new year high of $43.25.

Among stocks, OfficeMax, Inc.(OMX) is up 18% and earlier climbed to a new 52-week high of $10.62 following the IPO filing of Boise Cascade (BCC). OMX holds 109 million shares of BCC's Series B equity units, which represented, on September 30, 20.4% of BCC's equity securities.

Power Play -

Healthcare -

Healthcare ETFs are firmer: Health Care SPDR (XLV), up 0.7%; Vanguard Health Care ETF (VHT), up 0.64%; and iShares Dow Jones US Healthcare (IYH), up 0.82%. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) is up 2.2%.

In corporate news, Dynavax Technologies (DVAX) has trimmed earlier losses, now down 47.5%. It touched a fresh new year low of $2.22. Late Thursday, the clinical-stage biopharmaceutical company announced that the U.S. Food and Drug Administration (FDA) Vaccines and Related Biological Products Advisory Committee (Committee) voted 13 to one that HEPLISAV data adequately demonstrated immunogenicity. Additionally, the Committee voted eight to five with one abstention that there was insufficient data to adequately support the safety of HEPLISAV. Now that Dynavax has received the Committee's input and vote, the company said it will continue working with the FDA as it completes its review of the HEPLISAV application. The scheduled Prescription Drug User Fee Act (PDUFA) date for HEPLISAV is February 24, 2013.

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) 2014 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.

This article appears in: Investing Commodities
Referenced Stocks: EEM , IWM , QQQ , SPY , XLF

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