The major ETFs treaded water in quiet trade Wednesday as
investors sat on their hands ahead of the European Central Bank's
meeting Thursday that could reveal a new game plan to solve the
eurozone's debt crisis.
Here's an overview of the major ETF changes Wednesday.
SPDR S&P 500 (
SPY
): -0.09%.
PowerShares QQQ (
QQQ
), tracking the 100 largest nonfinancial stocks on the Nasdaq:
-0.10%.
SPDR Dow Jones Industrial Average (
DIA
): +0.11%.
IShares MSCI EAFE Index (
EFA
): -0.27%.
IShares MSCI Emerging Markets Index (
EEM
): -0.50%.
SPY closed at 140.92 a share. If it can't rally further and
breaks below 139.50 to 138.50 a share, Simon Maierhofer, founder
of iSpyETF.com, recommends selling.
Major Upcoming Events
Aside from the major ECB meeting, the market faces a busy
political schedule over the next week that could bring about
market-moving events.
Sept. 6: ECB President Mario Draghi's press conference. He is
rumored to be announcing a plan to buy unlimited amounts of
short-term government bonds to ease the debt crisis.
Sept. 7: U.S. August payrolls report. A weak report may
bolster the case for the Federal Reserve to engage in more
quantitative easing.
Sept. 12: German constitutional court ruling. It has to
determine whether the country's involvement in the European
bailout fund is legal.
"If the German Constitutional Court rules against German
rescue plans for other nations, the Bundesbank and all believers
in sound money can breathe again," John Browne, a senior economic
consultant to Euro Pacific Capital, wrote in a client note.
"However, it could imply an urgent and possibly terminal threat
to the euro. Likely that would imply considerable short-term
monetary volatility involving a short-term price spike in the
U.S. dollar and a longer-term increase in precious metals
prices."
Sept. 12: Election in the Netherlands. It could set the
country on a course to leave the euro.
Sept. 12: European bank regulations proposal. The European
Commission will propose bank regulatory reform in which it is
expected to push for sweeping oversight of eurozone banks by the
ECB, MarketWatch reported.
Sept. 13: FOMC two-day meeting concludes. It could announce
another round of quantitative easing.
"It is also possible that the Fed could extend its
zero-interest-rate forecast beyond 2014," Bob Doll, senior
adviser to BlackRock, wrote in a client note. "Should the Fed
follow through with possible new easing measures, we believe they
would provide a boost to the economy but would not materially
alter our 2% growth forecast."
"Given better relative economic and earnings growth levels as
well as highly accommodative monetary policies, we continue to
favor U.S. stocks vs. global benchmarks," Doll added.