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Mid-Day ETF Update: ETFs, Stocks Sink on Trade Truce Doubts, Fears of Recession


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Active broad-market exchange-traded funds in Tuesday's regular session:

iShares MSCI Emerging Index Fund ( EEM ): -1.5%

SPDR S&P 500 ( SPY ): -1.8%

SPDR Select Sector Fund - Financial ( XLF ): -3.2%

iShares China Large-Cap ETF ( FXI ): -1%

Invesco QQQ Trust, Series 1 ( QQQ ): -1.9%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV were lower. Actively traded PowerShares QQQ ( QQQ ) was down 1.9%.

US stocks were lower at session's half, reversing nearly all of Monday's trade-fueled gains on the lack of clarity of the meeting between the US and China coupled with increased fears of an economic recession.

The short-term yield curve on Treasuries inverted for the first time in more than 10 years. While investors always demand higher yields to commit funds for longer periods of time, a rush to short-term maturities may suggest a spike in uncertainties going forward. When the yield curve is inverted, investors believe current economic growth will outpace future economic growth, which indicates a recession is likely, the St. Louis Federal Reserve said in a recent report.

Power Play: Consumer

Consumer Staples Select Sector SPDR (XLP) was down 0.6% and Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones U.S. Consumer Goods (IYK) were lower.

Meanwhile, Consumer Discretionary Select Sector SPDR (XLY) was down 2.6% while retail funds SPDR S&P Retail (XRT) and Market Vectors Retail ETF (RTH) were weaker.

Barnes & Noble Education, Inc (BNED) plunged 28% after hitting an all-time low of $4.40 after the company reported fiscal Q2 EPS that beat expectations, but sales fell short. The company reported net income of $1.25 per share, compared with $1.03 per share a year earlier and ahead of the Capital IQ consensus estimate of $1.21 per share. The company's total sales for fiscal Q2 declined year over year to $814.8 million, from $886.9 million, lower than the Capital IQ consensus estimate of $842.5 million. For fiscal year 2019, Barnes & Noble Education expects consolidated sales in the range of $2.2 billion to $2.3 billion, with the current outlook expected to be at the low end, compared with the consensus estimate of $2.11 billion.

Winners and Losers

Financial

The Select Financial Sector SPDRs ( XLF ) was down 3.4%. Direxion Daily Financial Bull 3X shares (FAS) was down 8.2% and its bearish counterpart Direxion Daily Financial Bear 3X shares (FAZ) was up 8.2%.

ProAssurance (PRA) fell more than 2% after the company said late Monday Edward Rand, Jr. is assuming additional responsibilities as president of the company. Rand, a COO since January, previously served for 13 years as the company's CFO, according to a statement.

Technology

Technology Select Sector SPDR ETF (XLK) was down 2.3% and other tech funds iShares Dow Jones US Technology ETF (IYW) and iShares S&P North American Technology ETF (IGM) were in the red.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was down 2.6% and Semiconductor Sector Index Fund (SOXX) was down 3.3%.

Coupa Software (COUP) fell more than 8% after the firm said for its fiscal Q3, it recorded non-GAAP net income of $5.5 million, or $0.08 earnings per diluted share, compared to a loss of $2.8 million, or a $0.05 loss per share, in the same quarter last year, beating consensus estimates of a $0.03 loss per share. The company also saw total revenues increase 42% year over year in fiscal Q3, to $67.5 million from $47.3 million, also exceeding consensus estimates of $62.5 million. For fiscal Q4, Coupa expects revenues between $67.8 million and $68.3 million, higher than consensus estimates of $64 million, and break-even non-GAAP net income per share, also higher than consensus estimates of a $0.09 loss per share. For full-year fiscal 2019, the company expects revenues between $253.0 million and $253.5 million, higher than consensus estimates of $244.6 million, and non-GAAP net income per share between $0.11 and $0.13, higher than consensus estimates of a $0.07 loss per share.

Energy

Dow Jones US Energy Fund (IYE) was down 1.5% and Energy Select Sector SPDR (XLE) was down 1.5%.

Keane Group (FRAC) fell nearly 9% after the company said the underwritten secondary offering by one of its stockholders, Keane Investor Holdings, of 5,251,249 shares of Keane's common stock, has been priced at $10.77 per share. The company intends to repurchase from the underwriter 520,000 shares in the offering. Keane is not selling any common stock and will not receive any proceeds from the offering. All of the proceeds will be distributed solely to Trican Well Service, L.P. Following the distribution, Trican will cease to hold equity interests in Keane Investor Holdings. The offering is expected to close on Dec. 6, subject to customary closing conditions.

Commodities

Crude was up 0.06%. United States Oil Fund (USO) was down 0.4%. Natural gas rose 3% while United States Natural Gas Fund (UNG) was up 2.7%.

Gold was up 0.3%. SPDR Gold Trust (GLD) was up 0.6%. Silver was up 0.6%, while iShares Silver Trust (SLV) was up 1.1%.

Health Care

Health Care SPDR (XLV) was down 1.2% while other health care funds including Vanguard Health Care ETF (VHT) and iShares Dow Jones U.S. Healthcare (IYH) were lower. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was down 1.5%.

Tenax Therapeutics (TENX) slumped 9%, earlier touching its lowest level ever, after the company said it was offering 4,444,444 shares of Series A convertible preferred stock and 8,888,888 warrants each exercisable for one share of the common stock.

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) 2016 MTNewswires.com. All rights reserved. Unauthorized reproduction is strictly prohibited.



This article appears in: Investing , ETFs
Referenced Symbols: EEM , SPY , XLF , FXI , QQQ



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