Active broad-market exchange-traded funds in Wednesday's regular session:
iShares MSCI Emerging Index Fund ( EEM ):+1.5%
SPDR S&P 500 ( SPY ): +0.4%
SPDR Select Sector Fund - Financial ( XLF ): +0.2%
VelocityShares Daily 2x VIX Short Term ETN ( TVIX ): -6.2%
Barclays Bank PLC iPath S&P 500 VIX Short-Term Futures ETN ( VXX ): -3.5%
Broad Market Indicators
Broad-market exchange-traded funds, including SPY, IWM and IVV were higher. Actively traded PowerShares QQQ (QQQ) was up 0.9%.
U.S. stocks turned positive at session's half as strong Q1 corporate earnings overshadowed geopolitical risks brewing on the Korean peninsula and higher borrowing costs tied to the 10-year Treasury note. Better-than-expected results from Macy's (M) drove consumer stocks higher, offsetting losses in the energy and financial sectors of the S&P 500.
Earlier weakness was driven by news North Korean leader Kim Jong Un might pull out of the planned meeting with U.S. President Donal Trump. North Korea had earlier announced it will cancel talks with South Korea.
Bullish factory data also helped prop up Wall Street after industrial production and capacity utilization remained at multi-year highs. Production improved 0.7% in April, beating the consensus estimate for a 0.6% gain and followed an upwardly revised 0.7% increase in March.
At 78.0%, April capacity utilization missed estimates, but rose slightly from March's 77.6%.
Led by a significant decline in the construction of multi-family homes, housing starts were down 3.7% last month to a seasonally-adjusted annual rate (SAAR) of 1.287 million, below the consensus estimate of 1.324 million and follows an upwardly revised 1.336 million in March.
The pipeline of home construction also slowed as permits were down 1.8% in April to a SAAR of 1.352 million from a revised 1.377 million SAAR in March but slightly better than estimates.
Power Play: Health Care
Health Care SPDR (XLV) was up 0.6% and other health care funds Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were higher. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.8%.
Verastem (VSTM) fell more than 10% after the biopharmaceutical company said it has priced its registered underwritten public offering of 7.8 million shares at $4.50 a share, 14.1% lower than the share closing price on Tuesday. The gross proceeds to Verastem Oncology from the offering are expected to be $35 million. Verastem has also granted the underwriter a 30-day option to buy up to an additional 1.2 million shares of its common stock.
Winners and Losers
The Select Financial Sector SPDRs ( XLF ) was up 0.3%. Direxion Daily Financial Bull 3X shares (FAS) was up 0.8% and its bearish counterpart Direxion Daily Financial Bear 3X shares (FAZ) was down 0.6%.
Gladstone Investment (GAIN) fell some 2% after it reported late Tuesday adjusted net investment income of $0.21 per share in Q4, beating analysts' estimates of $0.19 per share in a Capital IQ poll.
Technology Select Sector SPDR ETF (XLK) was up 0.5% while other tech funds iShares Dow Jones US Technology ETF (IYW), iShares S&P North American Technology ETF (IGM) and iShares S&P North American Technology-Software Index (IGV) were higher.
Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was up 0.7% and Semiconductor Sector Index Fund (SOXX) was up 1.2%.
Microsoft (MSFT) rose marginally following a report by Bloomberg News saying the company is planning to release a smaller, low-cost line of Surface tablets as soon as the second half of 2018 to vie for the market dominated by Apple (AAPL). The report cited sources familiar with the matter. The new devices will feature 10-inch screens, smaller than the 12-inch screens utilized on the Surface Pro laptop line. The tablets, priced about $400, are expected to be approximately 20% lighter than the high-end models, but will have around four hours fewer battery longevity. The devices will also include USB-C connectivity, a first for Surface tablets, a new charging and syncing standard being utilized by some of the most recent smartphone models. Intel (INTC) will provide the main processor and graphics chips for the new devices, one of the sources told Bloomberg News.
Dow Jones US Energy Fund (IYE) was up 0.2% and Energy Select Sector SPDR (XLE) was up 0.2%.
Statoil ASA (STO) rose marginally after the firm said late Tuesday it is declaring an increased quarterly dividend of $0.23 per American depository receipt, up from $0.2201 per ADR during its most recent distribution and payable May 31 to investors of record on May 15. Shareholders participating at the company annual general meeting Tuesday also voted to approve a proposal changing the company's name to Equinor ASA. The company did not say whether its stock ticker on the New York Stock Exchange will change after the upcoming name change.
Crude was down 0.5%. United States Oil Fund (USO) was down 0.2%. Natural gas was down 0.4% while United States Natural Gas Fund (UNG) was down 0.5%.
Gold was down 0.02%. SPDR Gold Trust (GLD) was down 0.1%. Silver was up 0.3%, while iShares Silver Trust (SLV) was flat..
Consumer Staples Select Sector SPDR (XLP) was down 0.1% and other funds Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones US Consumer Goods (IYK) were weaker.
Consumer Discretionary Select Sector SPDR (XLY) was up 0.3% and retail funds SPDR S&P Retail (XRT), PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were in positive territory.
Office Depot (ODP) gained more than 6% after the retailer said, as part of its strategic transformation, it sees 2018 sales outlook unchanged at $10.8 billion, which is in-line with analyst expectations, and 2019 sales growth of 0-2%, which is above the Street view for $10.57 billion.