ETF Preview: ETFs, Futures Higher After Trump Says US Won't Impose New Tariffs On China

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

SPDR S&P 500 ( SPY ): +0.6%

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

VanEck Vectors Gold Miners ETF ( GDX ): +0.04%

iShares China Large-Cap ETF ( FXI ): +1.8%

SPDR Select Sector Fund - Financial ( XLF ): +0.5%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV, were higher. Actively traded PowerShares QQQ (QQQ) were up 0.8%.

US stock futures were higher ahead of the opening bell as Wall Street lauded the announcement from US President Donald Trump on Sunday that the US will not impose a new slew of tariffs on some $200 billion worth of Chinese goods. The statement came after the US and China wrapped up six straight days of talks in Washington.

The US was set to raise tariffs on the goods from 10% to 25% on March 1. The announcement will likely be welcomed on international markets and allay fears that a trade war between the world's largest economies will worsen in the short term.

The tariffs Trump imposed on China last year remain in effect, but the President said unresolved matters between the sides could find a solution at a summit meeting with his Chinese counterpart Xi Jinping.

Power Play: 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.

Carter's Inc. (CRI) jumped more than 5% after i t report ed fiscal Q4 adjusted earnings of $2.84 per share, up from $2.33 in the comparable period a year ago and topping the estimate of $2.56 from analysts polled by Capital IQ. For the quarter ended Dec. 30, total revenue of $1.09 billion was up from $1.03 billion in the comparable period a year ago and exceeded the Street projection of $1.07 billion.

Carter's said it expects fiscal Q1 adjusted EPS in the range of $0.65 to $0.70, below the Street estimate of $1.06. The company anticipates a fiscal Q1 sales decline in the range of 4% to 5% from $755.8 million in Q1 2018. The guidance implies a range of $718 million to $724.9 million, missing the Street estimate of $772.9 million. For full fiscal 2019, the company expects adjusted EPS to increase about 4% to 6% from $6.29 in fiscal 2018. The guidance implies a range of $6.54 to $6.67, topping the Street estimate of $6.53. The company also expects net sales to increase approximately 1% to 2% from $3.46 billion in 2018. The guidance implies a range of $3.49 billion to $3.53 billion, below the Street projection of $3.56 billion.

Winners and Losers


The Select Financial Sector SPDRs ( XLF ) was up 0.5% in the pre-market session. Direxion Daily Financial Bull 3X shares (FAS) was up 0.6% while its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ) was down 1%.

Abu Dhabi National Oil Company, the state energy company of the United Arab Emirates, said Sunday that it entered into a multibillion-dollar midstream pipeline infrastructure partnership with KKR (KKR) and BlackRock (BLK), marking the first time that institutional investors have invested in key midstream infrastructure assets of a Middle Eastern oil company. Under the agreement, a new entity, ADNOC Oil Pipelines, will lease the Emirati company's interest in 18 pipelines, transporting stabilized crude oil and condensate across its offshore and onshore upstream concessions, for a period of 23 years. The buyout firms will form a consortium that will maintain a 40% stake in the new entity with the rest going to ADNOC. The deal is expected to close in the third quarter, subject to regulatory approvals. ADNOC said that it expects upfront proceeds of approximately $4 billion from the transaction. BLK shares were up 0.5% in pre-market trading .


Technology Select Sector SPDR ETF (XLK) was up 0.7% 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) was up 0.2% and Semiconductor Sector Index Fund (SOXX) was up 1.2% in pre-market trade.

Ericsson (ERIC) ADRs fell mroe than 1% after it said it is expanding its Radio System portfolio by acquiring the antenna and filters business of Kathrein SE. Financial details of the transaction have not been disclosed. The transaction includes Kathrein's antenna and filter business for mobile networks, which generated revenues of EUR270 ($306.4 million), as well as 4,000 highly-skilled professionals in research and development, production and sales based in more than 20 locations around the world. The Swedish telecommunication infrastructure company said that apart from boosting its portfolio of antenna and filter products, the acquisition will aid in the evolution of advanced radio network products. It expects to complete the transaction in the third quarter, after which Kathrein's antenna and filters division will be integrated with the Segment Networks.


Dow Jones US Energy Fund (IYE) was flat and Energy Select Sector SPDR (XLE) was down 0.1% in pre-market trade.

Kosmos Energy (KOS) fell some 2% after it reported Q4 adjusted loss of $0.09 per share, excluding one-time items, compared with the prior-year period's $0.10 per share. Analysts polled by Capital IQ were expecting a loss per share of $0.03. Revenue was $309.5 million, up from $187.1 million in the same quarter last year. The Street view was for revenue of $332.6 million. Kosmos Energy's new dividend will be $0.0452 per common share and payable on March 28, to the stockholders of record at the close of business on March 7.

Aside from other highlights in the company's presentation for Capital Markets Day, it said it is targeting a reduction in 2019 capital expenditure to $425 million -- $475 million from $500 million -- $600 million, which can be done while maintaining the same 8%-10% production compound annual growth rate for 2019-2021. Kosmos also said it has discovered a significant and valuable resource in Mauritania and Senegal and the final investment decision of the Tortue project in December 2018 has created a value inflection point. Following interest from multiple third parties, the company intends to sell down its position to about 10%.


Crude was down 1.9%. United States Oil Fund (USO) was down 2.4%. Natural gas was up 1.9% while the United States Natural Gas Fund (UNG) was up 1.5%.

Gold was up 0.02%. SPDR Gold Trust (GLD) was down 0.04%. Silver was down 0.04%, while iShares Silver Trust (SLV) was down 0.3%.

Health Care

Health Care SPDR (XLV) was up 0.3% 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 up 1.1%.

Cesca Therapeutics (KOOL) rose nearly 16% after it said that its ThermoGenesis Corp. has received Health Canada approval of its PXP System for point-of-care harvesting of purified mononuclear cells and platelets from blood or bone marrow. The ThermoGenesis PXP System is a semi-automated system that harvests a precise volume of cell concentrate from a fixed sample of bone marrow aspirate.

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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