ETF Preview: Broad Market ETFs Gain Pre-Bell, Emerging Markets Funds Outperform

Pre-Market Movers:

INDL +7%

RUSL +5.7%

YINN +4.3%

TVIX -4.3%

RUSS -3.7%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were higher pre-market. Actively-traded PowerShares QQQ ( QQQ ) was up 0.8%. Emerging markets funds were the strongest gainers pre-bell, with Direxion Daily India Bull ( INDL ) gaining more than 6% and Direxion Daily Russia Bull ( RUSL ) up 5.7%.

U.S. stocks futures are heading higher, taking their cue from strong gains in European markets. Bourses are getting a lift Monday from expectations the Federal Reserve will hold off on raising interest rates this year following weaker-than-expected jobs data released Friday.

Power Play: Energy

Energy funds were flat to higher. Dow Jones U.S. Energy Fund ( IYE ) was flat after a sharply higher close Friday and Energy Select Sector SPDR ( XLE ) was up 0.8%.

Suncor Energy Monday reported an unsolicited $4.3 billion offer to Canadian Oil Sands shareholders for all outstanding shares.

Suncor is offering to exchange one-quarter of a Suncor share for each Canadian Oil share and that including Canadian OIl's outstanding debt of $2.3 billion as at June 30, the total transaction value is $6.6 billion.

Suncor said the offer represents a 43% premium to market, based on the closing price of the Canadian Oil shares and Suncor shares on October 2, and a 35% premium to the volume weighted average trading price of the COS shares on the TSX for the 30 trading days ended October 2. Suncor also said that if If the offer is accepted, Canadian oil shareholders would experience a 45% dividend "uplift."

Winners and Losers

Health Care

Health care funds were higher, though lagging the broader market. Health Care SPDR (XLV) was up 0.3%, iShares Dow Jones US Healthcare (IYH) and Vanguard Health Care ETF (VHT) were firmer. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) fell 0.14%.

ANI Pharmaceuticals (ANIP) shares were higher nearly 11% in recent pre-market trade after the specialty pharmaceutical company said its board has authorized a $25 million share buyback program.

The share repurchases will be funded with cash on hand and will take place through Dec. 31, 2016.


Funds in the financial sector were weaker, just behind the broader market. Select Financial Sector SPDRs (XLF) rose 0.3%. Direxion Daily Financial Bull 3X shares (FAS) was up 0.5%; Direxion Daily Financial Bear 3X Shares (FAZ) was up 4.2%.

Heidrick & Struggles International (HSII) said it has acquired Co Company, a London-based advisory boutique specializing in leadership services that accelerate organizational performance.

The provider of executive leadership search and leadership consulting said the acquisition provides the company with a leadership and organizational development capability with tools that can scale globally.

Terms of the deal were not disclosed.


Tech funds mostly inactive pre-market. Technology Select Sector SPDR ETF (XLK) was flat, iShares Dow Jones US Technology ETF (IYW) edging higher, iShares S&P North American Technology ETF (IGM) and iShares S&P North American Technology-Software Index (IGV) were inactive. SPDR S&P International Technology Sector ETF (IPK) was flat.

Semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were unchanged after closing higher.

Twitter ( TWTR ) gained almost 2% in pre-market trade Monday after the social media platform named Jack Dorsey its permanent CEO. Dorsey, the company's co-founder and current interim CEO, is also CEO of digital payments company Square, Inc.

Adam Bain has also been named Twitter's COO.

The company says it will give out more information at an investor call Monday at 5:30am Pacific Time.


Crude was up 0.8%; United States Oil Fund (USO) was down 0.2%. Natural gas gained 0.6% and United States Natural Gas Fund (UNG) unchanged. Gold was down 0.1%, and SPDR Gold Trust (GLD) fell 0.5%.


Funds in the consumer sector were mostly inactive pre-bell. Consumer Staples Select Sector SPDR (XLP) gained 0.2%, iShares Dow Jones US Consumer Goods (IYK), and Vanguard Consumer Staples ETF (VDC) were flat.

Consumer Discretionary Select Sector SPDR (XLY) was unchanged, SPDR S&P Retail (XRT) gained 0.2%, PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were inactive.

Xenia Hotels & Resorts (XHR) has updated 2015 guidance to incorporate Q3 preliminary results and greater-than-anticipated weakness in the Houston Galleria submarket. The company revised its 2015 revenue per available room (RevPAR) growth guidance range to 4.50% to 5.25% from previous guidance of 5.0% to 6.0%.

"Due to a challenging third quarter, we are reducing our RevPAR range and forecasting Adjusted EBITDA to be between the low end and midpoint of our previously provided range," said Marcel Verbaas, President and Chief Executive Officer of Xenia Hotels & Resorts. "We believe this weakness is short-term and expect the fourth quarter to be the strongest RevPAR growth quarter of the year. We continue to be positive about the strength of overall industry fundamentals."

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

SPDR S&P 500 (SPY): -0.1%

SPDR Select Sector Fund - Financial (XLF): -1.6%

VIX Short-Term Futures ETN Ipath (VXX): +0.4%

iShares MSCI Emerging Index Fund (EEM): +1.4%

Market Vectors Gold Miners ETF (GDX): +5.9%

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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