Mid-Day ETF Update: ETFs, Stocks Heartened as July's Nonfarm Payrolls Data Surpass Forecasts

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

SPDR S&P 500 ( SPY ): +2.1%

Financial Select Sector SPDR ( XLF ): +2.6%

iShares Russell 2000 Index ( IWM ): +2.6%

PowerShares QQQ Trust, Series 1 ( QQQ ): 2.2%

iShares MSCI Emerging Markets Index ( EEM ): +3.1%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM, IVV and others, are firmer. Actively traded PowerShares QQQ ( QQQ ) is up 2.2%.

U.S. stocks continue to log gains, with major indices firmly in positive territory as better-than-expected nonfarm payrolls data boosted market sentiment. Despite July's unemployment rate edging higher to 8.3% from 8.2%, focus is on the unexpected job growth to 163,000, better than the analysts' forecasts of around 100,000. Also bolstering stocks is the report that the Institute for Supply Management's index of U.S. non-manufacturing activity rose to 52.6 in July, from 52.1 in June.

Winners and Losers

Financial -

Select Financial Sector SPDRs ( XLF ) is up 2.7%. Direxion Daily Financial Bull 3X shares (FAS) is up 6.6%. Its bearish counterpart, FAZ, is down 6.3%.

Actives in the sector are firmer: Bank of America (BAC), up 3.4%; Morgan Stanley (MS), up 5.9%; Citigroup (C), up 4.9%; and Goldman Sachs (GS), up 3%.

Knight Capital Group (KCG) is up 26.4% following a StreetInsider report that the company told brokers it obtained a line of credit that will allow it to operate for the day, and told clients to route orders to them as normal.

MGIC Investment (MTG) has hit year lows. FBR Capital downgraded MTG shares to Market Perform from Outperform.

Annaly Capital Management (NLY) is up 0.6%. Shares were downgraded to Hold from Buy at Wunderlich, with a price target of $17.50, down from the prior target of $18.

Industrial -

ETFs in the space are firmer at mid-day: Vanguard Industrials (VIS) is up 2.4%; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), up 2.5%; and Select Sector SPDR-Industrial (XLI), up 2.5%.

Granite Construction (GVA) is down 5% after it reported Q2 net income of $0.05 per diluted share on revenues of $539.6 million. In the same period last year, net income was $0.13 per diluted share on revenues of $484.7 million. The company has also made some adjustments to its 2012 guidance, reaffirming revenue guidance of $1.0 billion to $1.1 billion. It has also reaffirmed that it expects net income attributable to non-controlling interest in joint ventures to be in the range of $15.0 million to $18.0 million.

Beazer Homes USA (BZH) is up 1.52% after reporting a Q3 loss of $0.38 per share, which includes non-cash pre-tax charges for inventory impairments, and may not be comparable to the Capital IQ consensus of a $0.33 loss per share. In the same period last year, the company reported a loss of $0.75 per share. Revenues were $254.6 mln up 43.7% from $172.83 mln in the prior-year period, versus the analyst estimate of $272.97 mln.

Molycorp (MCP) has hit year lows after the rare earth oxide (REO) producer reported a Q2 loss of $0.03 per share, widely missing estimates of profit of $0.08 per share. Net sales for the quarter were $104.6 mln, missing estimates of $115.5 mln. The company is re-affirming its annual production of REO equivalent products to be in the range of 8,000 mt to 10,000 mt.

Energy -

Dow Jones U.S. Energy Fund (IYE) up 2.6%; Energy Select Sector SPDR (XLE) is up 2.7%.

Kodiak Oil & Gas (KOG) is up 8.5% following its Q2 report, posting EPS of $0.35, up from $0.08 per share last year. Results included $0.25 per share in items. The Street was at $0.10 per share, an ex items number. Oil and gas sales were $85.8 mln, up 288%.

EOG Resources (EOG) is up 11% on better-than-expected Q2 results, posting adjusted EPS of $1.47 per share versus the Capital IQ consensus of $0.93. Revenue for the quarter came in at $2.92 million versus the consensus estimate of $2.645 billion.

Commodities -

Crude was up 4.75% while natural gas was down 0.31%. United States Oil Fund (USO) is up 4.8%; United States Natural Gas Fund (UNG) is down 1%.

Gold was up near 1% while silver was up 2.43%. Among rare metal funds, SPDR Gold Trust (GLD) is up 1.1% and iShares Silver Trust (SLV) is up 2.8%.

Healthcare -

Health Care SPDR (XLV) is up 1.5% while other ETFs in the sector are also firmer: iShares NASDAQ Biotechnology Index (IBB), up 1.6%; Vanguard Health Care ETF (VHT), up 1.65% and iShares Dow Jones US Healthcare (IYH), up 1.6%.

WellCare Health Plans (WCG) is down near 10% after the company announced that it earned $1.24 per share, less items, on sales of $1.81 billion in Q2. That topped the Thomson Reuters mean for $1.21 per share on revenue of $1.79 billion. It sees adjusted earnings of $5.25-$5.45 per share for 2012, up from its prior forecast of $5.20-$5.40 per share. It sees full-year premium revenue of about $7.1 billion. Analysts are expecting a profit of $5.41 per share on revenue of $7.19 billion, according to Thomson Reuters.

StemCells (STEM) is up 3%, trimming earlier gains of 10%, after reporting Q2 earnings of $0.03 per share, versus an analyst consensus of minus $0.25, if comparable. Revenues were $249,000, versus the analyst estimate of $550,000. In the same period last year, the company reported EPS of minus $0.29 on revenues of $234,000.

ImmunoGen (IMGN) is down8%, reversing earlier gains after posting a narrower Q4 loss of $0.29 per share, ex one-time items, versus the Capital IQ consensus of a $0.30 loss per share. Revenues of $2.95 mln, however, missed the analyst estimate of $3.16 mln. In the same period last year, the company reported a loss of $0.23 on revenues of $6.5 mln. The company expects a net loss for FY13 to be between $70 mln to $74 mln. Cash used in operations are also expected to be between $78 mln to $82 mln, and capital expenditures to be between $4 mln to $5 mln.

Rosetta Genomics (ROSG) is down 17%. The company has priced an underwritten public offering of 5.5 million ordinary shares at a public offering price of $5.00 per share. The gross proceeds to Rosetta from this offering are expected to be approximately $27.5 million. The company plans to use the net proceeds from the offering primarily to fund its operations and for other general corporate purposes.

Consumer -

ETFs are higher: SPDR S&P Retail (XRT) is up 2.4%; PowerShares Dynamic Retail (PMR), up 1.7%; and Market Vectors Retail ETF (RTH), up 1.2%.

Blyth (BTH) is up 10.28% after the company said that it expects 2012 normalized earnings in the range of $3.00 to $3.15 per share, up from prior guidance of $2.75 to $2.88 per share.

Kraft Foods (KFT) has hit year highs.

Skullcandy (SKUL) is up 6% but off day highs. The company posted in yesterday's after hours session Q2 earnings of $0.24 per share, versus the Capital IQ consensus of $0.22. Revenues were $72.4 mln, versus the analyst estimate of $65.63 mln. Looking ahead, the company expects FY12 EPS of $1.10 - $1.20, excluding non-recurring items, in line with the consensus of $1.16. Revenues are expected to be $280 mln - $300 mln, also in line with the Street view of $296.47 mln.

Body Central (BODY) is down 15% and has hit year lows after reporting Q2 revenue of $79.4 mln, up from $74.7 mln a year ago. Earnings were $0.21, down from $0.33 per share last year. For Q3, the company expects revenue in the range of $68 to $70 mln and EPS of $0.02 to $0.04 per share. The Street consensus is $73 mln in revenue and EPS of $0.13, according to Capital IQ. For the full year, the company expects revenue of $314 to $317 mln and EPS of $0.80 to $0.83. The Street is at $322 mln in revenue and earnings of $1.08 per share.

Power Play -

Technology -

Tech actives are in positive territory: Apple (AAPL), up 1.4%; Microsoft (MSFT), up 2.1%; Intel (INTC), up 2.2%; Google (GOOG), up 2%; Cisco (CSCO), up 3.6%; and Yahoo (YHOO), up 1.5%.

MaxLinear (MXL) is up 28% after it reported late Thursday that its Q2 earnings were $0.05 per share, ex one-time items, above the Capital IQ consensus of $0.01. Revenues were $24.4 mln, also topping the analyst estimate of $23.96 mln. In the same period last year, the company reported a loss of $0.02 on revenues of $18.1 mln. Looking ahead, the company expects Q3 revenues to be $27 mln - $28 mln, better than the Street view of $25.82 mln.

ITT Corporation (ITT) is up 12% after it posted Q2 earnings of $0.50 per share, ex one-time items, versus an analyst consensus of $0.37. Revenues were $567.5 mln, versus the analyst estimate of $569.7 mln. In the same period last year, the company reported EPS of $0.46 on revenues of $552.4 mln. The company sees FY2012 EPS of $1.62 - $1.72. Analysts expects an EPS of $1.64.

OpenTable (OPEN) is up 18% after the company reported consolidated net revenues for Q2 2012 of $39.6 million, a 15% increase over Q2 2011, and above the Capital IQ consensus expectation of $39.38 million. Non-GAAP consolidated net income for Q2 2012, ex-items, $0.42 per diluted share, $0.05 better than the analyst consensus. For Q3, the company estimates revenue to be in the range of $39.1 - $40.2 million, non-GAAP adjusted EBITDA to be in the range of $15.0 - $16.4 million and non-GAAP EPS to be in the range of $0.34 - $0.38. All straddle the current Street view.

Mercadolibre (MELI) is now up 23% after the company reported Q2 2012 net revenues of $88.8 million, net income of $25.4 million, and EPS of $0.57, compared to $0.34 for the prior year quarter. The Capital IQ consensus called for EPS of $0.48 on revenue of $88.02 million.

Linkedin (LNKD) continues to gap higher, now up 14% after posting Q2 revenue of $228.2 mln, better than the analyst consensus of $216 mln on Capital IQ. EPS was $0.16, in line with estimates. For Q3, the company expects revenue of $235 to $240 mln, vs. estimates of $235 mln. For the full year 2012, the company is guiding for revenue of $915 to $925 mln, up from a prior view of $880 to $900 mln and ahead of the Street at $907 mln.

ETFs in the sector are higher: Technology Select Sector SPDR ETF (XLK), up 2%; iShares Dow Jones US Technology ETF (IYW), up 2.14%; iShares S&P North American Technology ETF (IGM), up 2.45%; and iShares S&P North American Technology-Software Index (IGV), up 3.04%.

SPDR S&P Semiconductor (XSD) is up 1.73%; Semiconductor Sector Index Fund (SOXX) is up 2.49%.

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



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 , XLF

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