ETF Preview: Broad Market ETFs Gain in Line With Futures As Federal Reserve Readies For Two-Day Meeting

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Pre-Market Movers Tuesday:

EWV +9.7%

NUGT +3.7%

DIG +3.6%

DUST -2.6%

TVIX -2.5%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were all higher pre-bell. Actively-traded PowerShares QQQ ( QQQ ) was up 0.4%.

U.S. stock futures are pointing to a higher open as the U.S. Federal Reserve begins a two-day meeting, which is now widely expected to result in the first interest rise in almost a decade. With the hike now mostly priced in, investors will be looking closely at the wording of the Fed's statement for clues as to how it plans to proceed.

Among data out Tuesday, the December National Association of Home Builder's (NAHB) housing market index is due at 10 a.m. ET and is expected to inch up to 63 from 62. The December Empire State manufacturing survey is due at 8:30 a.m. ET and is expected to narrow to -7.00 from -10.7 last month, while November CPI, also out at 8,30 am, is expected to be unchanged.

Power Play: Technology

Technology Select Sector SPDR ETF ( XLK ) fell 0.8%, 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 inactive after closing higher. Meanwhile, SPDR S&P International Technology Sector ETF (IPK) was also flat.

Semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) closed lower and are unchanged so far Tuesday.

Qualcomm (QCOM) shares were higher over 2% in recent pre-market trade after the wireless chip maker said it now expects its fiscal Q1 earnings to be at or modestly above the high end of its previous guidance ranges.

Upon releasing fiscal Q4 results on Nov. 4, Qualcomm provided a Q1 guidance for both GAAP and non-GAAP earnings between $0.80 per share and $0.90. Analysts polled by Capital IQ are expecting non-GAAP EPS of $0.87 and GAAP EPS of $0.79.

Qualcomm said it is "seeing a stronger quarter relative to prior guidance as 3G/4G device ASPs and shipments are favorably impacting the licensing business, and benefits are being realized from cost actions throughout the company."

Winners and Losers


Funds in the financial sector were firmer and above the broader market. Select Financial Sector SPDRs (XLF) was up 0.6%. Direxion Daily Financial Bull 3X shares (FAS) was up 1.2%; Direxion Daily Financial Bear 3X Shares (FAZ) gained 0.1%.

FactSet Research Systems (FDS), a provider of financial information and analytical applications, reported Q1 2016 diluted earnings per share of $1.43 ($1.44 adjusted) on revenues of $270.5 million, falling short of the Capital IQ consensus estimate of EPS of $1.63 on revenues of $272.11 million.

The company reported quarterly operating income of $87.3 million, compared to $80.3 million in the prior year period. Net income rose to $60 million from $55.9 million during the same period last year. Adjusted diluted EPS was up 9.1% to $1.44, and excludes the $0.01 per share detriment from acquisition-related expenses.

In its Q2 guidance, FactSet said it expects diluted EPS of between $1.49 and $1.53 on revenues of $280 million to $286 million.


Dow Jones U.S. Energy Fund (IYE) was flat and Energy Select Sector SPDR (XLE) was up 0.7%.

McEwen Mining (MUX, MUX.TO) ( MUX ) said Andrew Elinesky has been promoted to Senior Vice President & Chief Financial Officer.

Elinesky has served as Vice President, Argentina with responsibility for administrative and financial oversight of the San Jose Mine, as well as exploration and development of other assets. He has worked in progressively senior roles within McEwen Mining as Accounting Manager for US Gold from 2008 to 2010 and then Corporate Controller for Minera Andes from 2010 to 2012 prior to the merger of those companies to form McEwen Mining in 2012.


Crude was up 0.5%. United States Oil Fund (USO) was up 0.9%. Natural gas was down 1.8%. United States Natural Gas Fund (UNG) fell 1.9%. Gold was down 0.1% and SPDR Gold Trust (GLD) tipping into the green. Silver was down 0.2% and iShares Silver Trust (SLV) was flat.

Health Care

Health Care SPDR (XLV), iShares Dow Jones US Healthcare (IYH) and Vanguard Health Care ETF (VHT) were inactive after closing higher on Monday. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) was also unchanged after a firmer close.

ArQule (ARQL), a biopharmaceutical company, said it has received orphan drug designation from the Food and Drug Administration for ARQ 087 in the treatment of cholangiocarcinoma, or CCA.

The company is conducting a biomarker-driven phase 2 trial for ARQ 087 in the U.S. and Italy in intrahepatic cholangiocarcinoma patients with FGFR2 fusions. The launch of the trial followed the observation of two confirmed partial responses in the phase 1a portion of the trial. A minor response was observed in a third patient.


Consumer staples funds were in positive territory, outperforming the broader market. Consumer Staples Select Sector SPDR (XLP), iShares Dow Jones US Consumer Goods (IYK), and Vanguard Consumer Staples ETF (VDC) were in the green Monday and inactive pre-market.

Consumer Discretionary Select Sector SPDR (XLY) and SPDR S&P Retail (XRT) were edging higher, but underperforming the broader market, PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were flat.

Norwegian Cruise Line Holdings (NCLH) shares are down almost 3% pre-market after the cruise ship operator priced the sale of 10.3 million common shares at $57.65 a share, a discount of about 1.5% to Monday's closing price.

The stock is being sold by certain funds affiliated with Apollo Global Management and the company will not receive any proceeds from the offering.

The shares recently traded at $57.70 with a 52-week trading range of $42.55 - $64.27.

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

SPDR S&P 500 (SPY): +0.02%

VIX Short-Term Futures ETN Ipath (VXX): -2.3%

iShares MSCI Emerging Index Fund (EEM): +1.1%

SPDR Select Sector Fund - Financial (XLF): -0.1%

PowerShares QQQ Trust, Series 1 ( QQQ ): -0.2%

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 All rights reserved. Unauthorized reproduction is strictly prohibited.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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