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ETF Preview: ETFs, Futures Firmer Ahead of the Open as US and China Extend Trade Talks to Next Week

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

iShares MSCI Emerging Index Fund ( EEM ): -0.3%

SPDR S&P 500 ( SPY ): +0.4%

iShares Inc iShares MSCI Brazil ETF ( EWZ ): +0.1%

ProShares UltraPro Short QQQ ( SQQQ ): -1.0%

Invesco QQQ Trust, Series 1 ( QQQ ): +0.4%

Broad Market Indicators

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

US stock futures were higher ahead of the opening bell after officials from both China and US agreed to extend trade negotiations to next week, saying that they are working toward a memorandum of understanding that would be the basis for a trade deal that US President Donald Trump and Chinese President Xi Jinping could later sign.

In economic data news, January import prices decreased 0.5% after declining an unrevised 1.0% in December. Excluding oil, import prices fell 0.2% in January after an unrevised 0.0% reading in December. Meanwhile, export prices slipped 0.6% in January after decreasing an unrevised 0.6% in December. Excluding agriculture, export prices fell 0.3% in January after declining an unrevised 1.1% in December.

The February reading of the Empire State manufacturing index came in at 8.8, beating the consensus for a 7.6 reading. January's reading of 3.9, which was a decline of 7.6 points, was a 20-month low.

Looking ahead, industrial production and capacity utilization for January were scheduled for release at 9:15 am ET, with forecasts for an increase of 0.1% and to 78.8%, respectively. January industrial production came in down 0.6%, while capacity utilization was at 78.2%. This will be followed at 10 am ET by the University of Michigan's consumer-sentiment index for February, with expectations for a reading of 93.0.

Power Play: Technology

Technology Select Sector SPDR ETF (XLK) and other tech funds iShares Dow Jones US Technology ETF (IYW) and iShares S&P North American Technology ETF (IGM) were inactive.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were flat.

Nvidia (NVDA) rose more than 5% after i t report ed fiscal Q4 non-GAAP earnings that beat but revenue that missed Wall Street expectations. Non-GAAP EPS fell 53% to $0.80 for the quarter ended Jan .27, from $1.72 a year earlier. That beat the $0.75 average estimate of analysts surveyed by Capital IQ. Fiscal Q4 revenue fell 24% to $2.21 billion, from $2.91 billion, trailing the analyst consensus of $2.25 billion. Moving forward, the company anticipates fiscal Q1 revenue to be $2.20 billion, plus or minus 2%. Wall Street was looking for $2.34 billion. For FY20, the company expects revenue to be flat to down slightly. Analysts had forecast a decline of 3.9%.

Winners and Losers

Financial

The Select Financial Sector SPDRs (XLF) was flat in the pre-market session. Direxion Daily Financial Bull 3X shares (FAS) was down 0.3% while its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ) was up 0.1%.

Moody's (MCO) fell 0.5% after the credit rating agency reported Q4 adjusted earnings of $1.63 per share, up from $1.51 in the same period a year ago and missing the estimate of $1.68 from analysts polled by Capital IQ. Total revenue of $1.06 billion was down from $1.17 billion in the same period a year ago and missed the Street projection of $1.14 billion. The company expects full-year 2019 adjusted EPS in the range of $7.85 to $8.10, straddling the Street estimate of $7.88.

Energy

Dow Jones US Energy Fund (IYE) was flat and Energy Select Sector SPDR (XLE) was up 0.2% in pre-market trade.

Royal Dutch Shell (RDS.A) rose marginally after it said it will acquire German solar battery maker sonnen for an undisclosed amount. The acquisition follows an investment made by the oil producer last may and means after regulatory approval and completion of the deal, sonnen will become a wholly owned subsidiary of Shell. Shell New Energies was established in 2016 and focuses on new fuels for transport, such as biofuels and hydrogen, and involvement in every step of the power process from electricity generation to buying and selling to end-user supply, the company said. The division plans to spend an average of $1 billion to $2 billion a year until 2020 on commercial opportunities, it said.

Commodities

Crude was up 1.6%. United States Oil Fund (USO) was up 0.7%. Natural gas was up 0.9% while the United States Natural Gas Fund (UNG) was up 0.4%.

Gold was up 0.3%. SPDR Gold Trust (GLD) was up 0.4%. Silver was up 0.8%, while iShares Silver Trust (SLV) was up 0.3%.

Health Care

Health Care SPDR (XLV) and other health care funds including Vanguard Health Care ETF (VHT) and iShares Dow Jones U.S. Healthcare (IYH) were flat in pre-market trade. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was also inactive.

Acorda Therapeutics (ACOR) rose more than 9% after it reported a sharp year-over-year decline financial results for Q4. The biopharmaceutical company developing therapies for neurological disorders posted non-GAAP earnings of $0.45 per share, compared with the prior-year period's $0.61 per share. Analysts polled by Capital IQ were expecting a loss of $0.60 per share, if comparable. Revenue was $69.2 million, down 63.3% from $188.4 million in the same quarter last year. The Street view was for revenue of $48.1 million.

The company said that it will no longer provide revenue guidance for Ampyra, the company's prescription medicine used to help improve walking in adults with multiple sclerosis, due to the unpredictable trajectory of revenue decline given the entrance of generics. Additionally, Acorda said that in January 2019, the Federal Circuit denied the company's petition for an en banc hearing in the Ampyra patent appeal process. The company intends to file a petition for certiorari appealing the case to the U.S. Supreme Court.

Consumer

Consumer Staples Select Sector SPDR (XLP) and Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones U.S. Consumer Goods (IYK) were inactive.

Consumer Discretionary Select Sector SPDR (XLY) and retail funds SPDR S&P Retail (XRT) and Market Vectors Retail ETF (RTH) were quiet in pre-market trade.

Newell Brands (NWL) fell more than 14% after it said Q4 sales fell 6% to $2.3 billion from the year-ago period and missed the CapIQ mean for $2.43 billion. Reported EPS were $0.46 compared with $3.38 last year and normalized EPS rose to $0.71 from $0.68. Estimates were for GAAP EPS of $0.58 and normalized EPS of $0.65. Q1 sales are seen between $1.66 billion to $1.70 billion, below forecasts for $1.8 billion. Normalized EPS are seen between $0.04 to $0.08, missing forecasts for $0.20. FY19 sales are seen between $8.2 billion to $8.4 billion, missing expectations for $8.79 billion. Normalized EPS are seen between $1.50 to $1.65, short of the Street's $1.92.

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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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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