Mid-Day ETF Update: Broad Market ETFs Decline on Fed Stimulus Concern; Gold Funds Shine
Active broad-market exchange-traded funds in Wednesday's regular session:
SPDR S&P 500 ( SPY ): -0.8%
iShares MSCI Japan Index Fund ( EWJ ) -2.25%
iShares MSCI Emerging Markets Index ( EEM ): -1.2%
iPath VIX Short Term Futures ( VXX ) +2.1%
Select Financial Sector SPDRS ( XLF ): -0.1%, has turned negative from near year highs.
Broad Market Indicators
Most broad-market exchange-traded funds, including SPY, IWM, IVV and others, are lower on concerns the U.S. Federal Reserve will soon pare back economic stimulus. Gold funds are among the best performers, with Purefunds ISE Mining (MSXX) up 2.4% from near year lows. Actively traded PowerShares QQQ (QQQ) is down 0.65%, but are at the high end of their year range.
U.S. stocks are lower at the midsession on concerns the Federal Reserve will ease off its bond-buying program. With no significant economic data out, investors are also focusing on the Organization for Economic Cooperation and Development's (OECD) warning that global growth would be hit should central banks end their monetary-easing programs. The OECD cut its forecast for global growth to 3.1% for the current year and 4% in 2014, while the International Monetary Fund cut its forecast for China's growth to 7.75% this year and next. In April, the IMF predicted growth of 8% this year and 8.2% in 2014.
Winners and Losers
Select Financial Sector SPDRs ( XLF ) is down 0.2% from near year highs. Direxion Daily Financial Bull 3X shares (FAS) is down 1.2%. Its bearish counterpart, FAZ, is up 1.2%, but remains close to its lowest levels of the year.
Among financial stocks, SLM Corporation's (SLM) Board of Directors has appointed John F. Remondi chief executive officer, effective immediately. The shares are now up 3% at around $23.60 having earlier hit a year top of $26.17.
Industrial ETFs Vanguard Industrials (VIS) is off 0.8% from near year highs; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ) is down 0.7% and still near 52 week highs; and Select Sector SPDR-Industrial (XLI) has dropped 0.6% from near year highs.
In sector news, Schnitzer Steel (SCHN) is down more than 3% at near $25.90 after saying that during Q3 ferrous export selling prices declined steadily with market prices at the end of May approximately $50 per ton lower than at the end of Q2, driven primarily by lower export demand. The combination of declining selling prices, continued constrained supply trends, and lower tax benefits are expected to result in sequentially lower consolidated net income.
Dow Jones U.S. Energy Fund (IYE) is down 0.55% and Energy Select Sector SPDR (XLE) is down 0.6%. Both remain close to the top of their 52-week ranges.
In sector news, Ballard Power (BLDP) is up 4% at around $1.90 after earlier hitting a new year high of $2.39 after it signed a non-binding Memorandum of Understanding (MOU) with its partner Azure Hydrogen Corporation of Beijing, China (Azure), extending the scope of their collaboration to include fuel cell buses.
July crude is down 1.65%; July natural gas is down 1.66%. United States Oil Fund (USO) is down 1.5%. United States Natural Gas Fund (UNG) is down 2.2%.
August gold is up 0.65% and silver for July delivery is up 0.75%. Among rare metal funds, SPDR Gold Trust (GLD) is up 0.8%, but remains near its year low of $130.51; iShares Silver Trust (SLV) is up 0.6%, also near year lows.
Consumer ETFs Consumer Staples Select Sector SPDR (XLP) had dropped 1.9%, iShares Dow Jones US Consumer Goods (IYK) is down 1.4%, and Vanguard Consumer Staples ETF (VDC) has fallen 1.75%.
Shares in Stewart Enterprises (STEI) have surged 34%, hitting a 52-week high of $13.10, after agreeing to be bought by Service Corp International (SCI) in a deal worth $1.4 billion. Service Corp will pay $13.25 a share, a 36% premium to Stewart's closing price on Tuesday. Both companies operate funeral homes and cemetaries.
Healthcare ETFs may be lower, but they are near year high levels. Health Care SPDR (XLV) has fallen 1.8%; Vanguard Health Care ETF (VHT) is down 1.8%; and iShares Dow Jones US Healthcare (IYH) has fallen 1.7%. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) is down 1.4%.
In corporate news, Sucampo (SCMP) is up 1% after it said it received orphan drug designation in the European Union for unoprostone isopropyl for the treatment of retinitis pigmentosa (RP). RP is a genetic disease characterized by progressive, irreversible vision loss and decreasing visual acuity, and there are no drugs or therapeutic procedures currently approved for the treatment of RP today.
Tech ETFs Technology Select Sector SPDR ETF (XLK) is down 0.46%, iShares Dow Jones US Technology ETF (IYW) is down 0.19%, iShares S&P North American Technology ETF (IGM) is down 0.45% and iShares S&P North American Technology-Software Index (IGV) is down 0.9%.
Semiconductor ETFs, SPDR S&P Semiconductor (XSD) has gained 0.13% and Semiconductor Sector Index Fund (SOXX) is slightly ahead, up 0.19%.
SPDR S&P International Technology Sector ETF (IPK) is down 0.67%.
Shares of Perfect World (PWRD) have extended after-hours gains to trade up almost 12%, while setting a new 52-week high of $14.57, after the company reported earnings late Tuesday that beat The Street's expectations. The company reported Q1 earnings of $0.49 per share, ex one-time items, versus the Capital IQ consensus of $0.47. Revenues were $100.6 million, versus the analyst estimate of $98.78 million.