Mid-Day ETF Update: ETFs Mixed to Firmer, Stocks Climb Back Up as Fed Buys Treasurys for Operation Twist

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Active broad-market exchange-traded funds at mid-day:

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

iShares Russell 2000 Index ( IWM ): -0.1%

PowerShares QQQ Trust, Series 1 ( QQQ ): -0.1%

iShares MSCI Emerging Markets Index ( EEM ): +0.32%

iPath S&P 500 VIX Short Term Futures TM ( VXX ): -2.2%, close to year lows

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM, IVV and others, are mixed to modestly firmer. Actively traded PowerShares QQQ ( QQQ ) is down 0.1%.

U.S. stocks have recouped earlier losses, now firmer and aiming for a fourth day in positive territory. Market sentiment brightened as the Federal Reserve got ready to buy long-dated Treasury securities as part of its stimulus plan, extending average maturity of the U.S. government debt. Earlier, stocks were pressured by renewed concerns over a global economic slowdown following lackluster U.S. economic data and downbeat Chinese inflation data.

Winners and Losers

Financial -

Select Financial Sector SPDRs (XLF) is up 0.2%. Direxion Daily Financial Bull 3X shares (FAS) is up 0.4%. Its bearish counterpart, FAZ, is down 0.3%.

In corporate news, Global Cash Access Holdings (GCA) is up near 13% after it reported Q2 EPS of $0.23, above the Capital IQ consensus of $0.20. Revenues were $147.5 mln, missing the consensus of $151.96 mln. The company also reaffirms its guidance for FY12, now seeing EPS of $0.76 - $0.82, in line with the Street view of $0.80.

Morgan Stanley (MS) is up 0.4% after it announced earlier that it is considering closing brokerage offices, laying off support staff and requiring some branch managers also to generate revenue as advisers under a cost-cutting drive, Reuters reports, citing three people briefed on internal discussions.

Technology -

ETFs are leaning higher in the tech sector: Technology Select Sector SPDR ETF (XLK), up 0.1% near year highs; iShares Dow Jones US Technology ETF (IYW), up 0.05%; iShares S&P North American Technology ETF (IGM), flat; and iShares S&P North American Technology-Software Index (IGV), flat.

SPDR S&P Semiconductor (XSD) has turned negative and Semiconductor Sector Index Fund (SOXX) is up 0.1%.

SPDR S&P International Technology Sector ETF (IPK) is flat.

In corporate earnings news, Hewlett-Packard (HPQ) shares are up near 3% after the company lifted its FQ3 non-GAAP earnings per share (EPS) outlook to $1.00 per share, up from a previous range of $0.94 to $0.97. Analysts are expecting $0.97.

Computer Sciences (CSC) is up 17% after the IT company reported Q1 EPS of $0.26, above estimates of $0.22. Revenues for the quarter came in at $3.9 bln, ahead of estimates of $3.8 bln.

Rackspace Hosting (RAX) is up 9% after it posted Q2 earnings of $0.18 per share, below the Capital IQ consensus of $0.19. Revenues were $319 mln, better than the analyst estimate of $318.15 mln. In the same period last year, the company reported EPS of $0.13 on revenues of $247.2 mln.

Express Scripts Holding (ESRX) is up 8% after reaching a new year high of $60.85. The company reported late yesterday Q2 adjusted EPS of $0.88, vs. the analyst consensus of $0.82 per share. Revenue was $27.6 bln, vs. expectations of $26.5 bln. For 2012, the company expects EPS in the range of $3.60 to $3.75, vs. expectations of $3.54 per share.

EZchip Semiconductor (EZCH) extends its losses into the mid-day, now down 24% and closer to year lows after reporting that Q2 sales fell 9% to $15.8 million from a year ago. Non-GAAP EPS fell to $0.29 from $0.33 a year earlier.

Industrial -

ETFs are mixed: Vanguard Industrials (VIS), down 0.18%; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), 0.09%; and Select Sector SPDR-Industrial (XLI), down 0.22%.

MEMC Electronic Materials (WFR) is up 17.96%, paring down its earlier gains of about 39%. It reported Q2 non-GAAP revenue of $933.4 mln and non-GAAP EPS of $0.14. GAAP revenue was $808.4 mln and GAAP EPS loss was $0.27 per share. The analyst consensus is $748 mln in revenue and a loss of $0.02 per share. It's unclear which earnings number is comparable.

Rio Tinto (RIO) is up 3.13% after MarketWatch reported the company continues to look at ways to exit some of its aluminum assets and its diamonds business and has had interest from potential buyers in individual operations as well as collectively.

Energy -

Dow Jones U.S. Energy Fund (IYE) is up 0.41% while Energy Select Sector SPDR (XLE) is up 0.39%.

Among stocks, Petroleo Brasileiro S.A. (PBR) is up 4.74% on reports that fuel prices are expected to increase in its home country, StreetInsider said. Brazilian Energy Minister Edison Lobao said the country needs to raise gas prices, hinting that an increase might happen in 2012, though no specific date was given. Petrobras, a state-controlled energy company, raised gasoline and diesel prices recently to offset some refining costs as well as raise funds to boost investment in domestic oil production.

HollyFrontier (HFC) is up 0.41% after the company reported that its Q2 EPS was $2.39, versus the Capital IQ estimate of $2.32. Revenues were $4.81 bln, versus the consensus of $5.09 bln.

NRG Energy (NRG) is steady higher, up 2.15% after reporting Q2 earnings of $1.08 per share, including a tax liability reversal. This may not be comparable to the Capital IQ consensusof $0.28. In the prior-year period, the company posted EPS of $2.53. Revenues fell 4.9% to $2.17 bln from $2.28 bln, and below the $2.68 bln consensus.

Commodities -

Crude was up around 0.4%. United States Oil Fund (USO) is up 0.57%. Natural gas was down 1%. United States Natural Gas Fund (UNG) is down 1.13%.

Gold was up 0.16%; likewise, silver was down 0.43%. Among rare metal funds, SPDR Gold Trust (GLD) is up 0.06% and iShares Silver Trust (SLV) is down 0.29%.

Healthcare -

Healthcare and biotechnology ETFs are in the mostly in the green: Health Care SPDR (XLV), up 0.34%; iShares NASDAQ Biotechnology Index (IBB), down 0.53%; Vanguard Health Care ETF (VHT), up 0.13%; and iShares Dow Jones US Healthcare (IYH), up 0.37%.

Warner Chilcott (WCRX) is down 5.8% at $16.50 following the company's announcement late yesterday that it is no longer seeking a buyer.

Given Imaging (GIVN) is down 11.6%, trimming earlier losses of more than 18%, after reporting Q2 revenues of $44.5 million compared to $44.8 million in the second quarter of 2011. Ex-items, Q2 revenues were $46 million. Net income for the period was $4.9 million, or $0.16 per share on a fully diluted basis, compared to $4.1 million, or $0.13 per share on a fully diluted basis, in the Q2 2011. Analysts expected Given to bank $48.5 million for the period, and EPS of $0.18. As a result of ongoing economic weakness in Europe, the company lowered its FY 2012 revenue guidance from $190 - $200 million to $185 - $190 million. Despite lowering top-line guidance, the company believes its earnings per share guidance will remain unchanged, between $0.70 and $0.80 on a non-GAAP basis. However, the company expects that 2012 earnings per share will be closer to the lower range of the guidance.

Power Play -

Consumer -

ETFs are now firmer: Consumer Staples Select Sector SPDR (XLP), up 0.53%; iShares Dow Jones US Consumer Goods (IYK), up 0.11%; and Vanguard Consumer Staples ETF (VDC), 0.34%.

SPDR S&P Retail (XRT) is up 0.15%; PowerShares Dynamic Retail (PMR), 0.24%; and Market Vectors Retail ETF (RTH), up 0.55%.

Macy's (M) is up 2.84% after it posted Q2 earnings of $0.67 per share, ex one-time items, versus an analyst consensus of $0.65. Revenues were $6.12 bln, versus the analyst estimate of $6.10 bln. In the same period last year, the company reported EPS of $0.55 on revenues of $5.94 bln. Macy's also raised its earnings guidance for FY12 to $3.30 - $3.35, up from its previous guidance of $3.25 to $3.30. Consensus estimates are at $3.36.

McDonald's (MCD) is down 1.46% after it reported global comp store sales were flat in July, as the promotional activity did not offset the effects of the sluggish economy and last year's launch of the Mango Pineapple smoothie, the company said in a statement.

Dean Foods (DF) continues to gain into the mid-day, now up 36.43%, with session highs nearing its 52-week high of $17.25. The company earlier reported Q2 adjusted EPS of $0.36, vs. the analyst consensus of $0.31 per share. Sales were $3.12 bln, vs. the Street view of $3.22 bln, according to Capital IQ. For Q3, EPS is targeted at $0.25 to $0.30, vs. expectations of $0.25 per share. For the full year, EPS is seen at $1.18 to $1.28, vs. expectations of $1.18 per share.

Ralph Lauren (RL) is down 2.42% after it reported Q1 revenue of $1.6 bln, up 4% and ahead of the analyst consensus of $1.58 bln on Capital IQ. EPS was $2.03, up 7% and better than expectations of $1.79 per share. The company continues to expect consolidated net revenues for Fiscal 2013 to increase by a mid-single-digit percentage. In the second quarter of Fiscal 2013, the company expects consolidated net revenues to decline by a mid-single-digit percentage, as a low-double-digit decline in wholesale revenues is partially offset by a mid-single-digit increase in retail revenues.



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: EEM , IWM , QQQ , SPY , VXX

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