ETF Preview: ETFs, Futures Higher as Apple's Strong Q1 Results Drive Tech SectoR, Broader Market Rally

Active broad-market exchange-traded funds in Wednesday's pre-market session:

VanEck Vectors Gold Miners ETF ( GDX ): -0.5%

SPDR S&P 500 ( SPY ): +0.2%

iShares MSCI Emerging Index Fund ( EEM ): +0.6%

SPDR Select Sector Fund - Financial ( XLF ): +0.4%

Direxion Daily Gold Miners Index Bull 3X Shares ( NUGT ): -1.4%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV edged lower. Actively traded PowerShares QQQ (QQQ) was up 0.6%.

U.S. stock futures were firmer ahead of Wednesday's open as Apple's (AAPL) better-than-expected Q1 results drove the tech sector higher, and helped lift broader market sentiment.

Investors were looking ahead to the statement of the Federal Reserve's Open Market Committee as the policy meeting winds down later. Expectations are for the central bank to maintain interest rates.

In economic data news, the private sector added 246,000 jobs in January, far more than had been expected, according to Automatic Data Processing (ADP).

Still ahead, the Markit manufacturing PMI for December will be reported at 9.45 a.m. ET, followed by the ISM manufacturing index at 10 a.m. ET. Construction spending for December will also come out at 10 a.m. ET.

Facebook (FB) will be reporting its financial results in Wednesday's after hours session.

Power Play: Technology

Tech funds Technology Select Sector SPDR ETF (XLK), 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 quiet in pre-market trading . SPDR S&P International Technology Sector ETF (IPK) was flat.

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

Apple (AAPL) was up 4.9% after it reported Q1 revenue of $78.4 billion, up from $75.9 billion in the year ago quarter and better than the analyst consensus of $77.25 billion on Capital IQ. Earnings were $3.36 per share, up from $3.28 per share last year and topping the Street view of $3.22 per share. For Q2, the company expects revenue in the range of $51.5 to $53.5 billion, shy of the Street view of $53.64 billion. In Q1, the company sold 78.29 million iPhone units, up from 74.7 million units in Q1 a year ago and better than expectations of 77 million units. iPad unit sales were 13 million, a decline from 16.1 million sold a year ago. Mac unit sales were 5.37 million, vs. year ago levels of 5.31 million units.

Winners and Losers


Select Financial Sector SPDRs ( XLF ) was up 0.7%. Direxion Daily Financial Bull 3X shares (FAS) was up 1.6% and its bearish counterpart, FAZ was down 1.3%.

Brookfield Infrastucture Partners (BIP) was up 3% after it reported Q4 funds from operations of $0.69 per share, up from $0.59 per share a year earlier and three cents above the consensus. Revenues rose to $677 million from $455 million a year earlier and topped expectations for $647.2 million. The utility company also said it will distribute a quarterly dividend of $0.435 per share, up from a prior quarterly distribution of $0.39 per share. The dividend is payable on March 31 to holders of record on Feb. 28.


Industrial funds iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), Vanguard Industrials (VIS) and Select Sector SPDR-Industrial (XLI) were flat.

United States Steel (X) was up 3.6% after it reported late Tuesday adjusted diluted net earnings per share of $0.27, well ahead of the average of estimates on Capital IQ for a loss of $0.02 and compared to the year earlier loss of $0.23. Net sales rose to $2.65 billion from $2.57 billion, almost in line with the Street's view for $2.665 billion. If market conditions remain the same, the company sees 2017 net earnings of approximately $535 million, or $3.08 per share. The company also declared a dividend of $0.05 a share payable on March 10 to investors on record by Feb. 10.


Dow Jones U.S. Energy Fund (IYE) was flat while Energy Select Sector SPDR (XLE) was down 0.4% in pre-market trade.

Marathon Petroleum (MPC) was up 2.3% after it reported Q4 net profit of $0.43 per share, up from $0.35 per share in the prior year period and came in higher than the $0.27 per share Street estimate provided by Capital IQ. Total revenues were $17.28 billion, up from $15.68 billion reported for the same period last year and lower than the $17.77 billion Street estimate.


Crude was up 1%. United States Oil Fund (USO) was up 0.9%. Natural gas was up 2.1% while United States Natural Gas Fund (UNG) was u 1.7%.

Gold was down 0.3%. SPDR Gold Trust (GLD) was down 0.7%. Silver was down 0.4% while iShares Silver Trust SLV) was down 0.5%.

Health Care

Health care funds Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were flat. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.4%.

Catabasis Pharmaceuticals (CATB) plunged 66.5% to below the regular-session record low. The company said late Tuesday top-line safety and efficacy results for Part B of the MoveDMD trial of edasalonexent (CAT-1004) to treat Duchenne muscular dystrophy (DMD) were not statistically significant. It plans to complete a full analysis of the data from Part B of the MoveDMD trial and to submit the data for presentation at an upcoming scientific conference. The open-label extension portion (Part C) of the MoveDMD trial is ongoing. Catabasis intends to report the results from Part C in 2017, with an interim update in Q2.


Consumer staples funds Consumer Staples Select Sector SPDR (XLP), Vanguard Consumer Staples ETF (VDC), and iShares Dow Jones US Consumer Goods (IYK) were unchanged.

Consumer Discretionary Select Sector SPDR (XLY) and retail funds SPDR S&P Retail (XRT), PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were also flat.

Tata Motors Ltd (TTM) American depository shares were higher 2% after the company said total domestic passenger vehicle sales rose 21% year-over-year in January to 12,907. Total passenger and commercial vehicle sales were down 1% in the month to 46,349 vehicles while exports declined 13% to 4,921.

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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