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ETF Preview: ETFs, Futures Lower as Dec Trade Deficit Hits 10-Yr High; Street Awaits US-China Trade Talk Result

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

iShares MSCI Emerging Index Fund ( EEM ): +0.02%

SPDR S&P 500 ( SPY ): -0.08%

VanEck Vectors Gold Miners ETF ( GDX ): -0.2%

Vanguard FTSE Emerging Markets ETF ( VWO ): 0.0%

ProShares UltraPro Short QQQ ( SQQQ ): -0.3%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV, were weaker. Actively traded PowerShares QQQ (QQQ) were up 0.1%.

US stock futures were lower ahead of the open as traders continued to monitor developments on the ongoing trade negotiations between the US and China.

Traders also seemed to shrug off a new round of stimulus measures announced by Beijing late Tuesday.

In economic data news, the national employmen t report from Automated Data Processing came in at 183,000 for February versus forecasts for 180,000. The January reading was revised to 300,000 from the initial 213,000 reported.

And, the December trade deficit rose nearly 19% to a seasonally adjusted $59.8 billion -- a 10-year high -- versus the consensus for a $57.6 billion deficit and compared with the previous deficit of $49.3 billion.

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.

Abercrombie & Fitch (ANF) rose more than 12% after the company reported Q4 adjusted earnings fell to $1.35 from $1.38 a year ago, but still topped the $1.15 average estimate from analysts polled by Capital IQ. Net sales for the period also dropped to $1.16 billion from $1.19 billion last year, marginally beating the $1.14 billion CapIQ mean. For fiscal 2019, the company projected a net sales growth of 2% to 4%, also beating the Street consensus forecast. Fiscal Q1 net sales, meanwhile, are expected to be flat compared to year-ago figures.

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 1.4% while its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ) was down 1%.

Stellus Capital Investment (SCM) was up more than 1% after it reported full year 2018 net investment income of $1.42 per share, up from $1.21 in the prior year. Analysts polled by Capital IQ expected full year normalized EPS of $1.29. Full year 2018 total investment income of $53.3 million was up from $39.6 million in the same period a year ago. Analysts expected full year total revenue of $51.9 million.

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 both quiet in pre-market trade.

Logitech (LOGI) was up some 3% after it reaffirmed its FY2019 outlook of 9% to 11% revenue growth in constant currency and $340 million to $345 million in non-GAAP operating income. The computer peripheral manufacturer also said that it expects mid to high single-digit sales growth in constant currency and $375 million to $385 million in non-GAAP operating income in FY2020, an increase of approximately 10% to 12% from the midpoint of the company's profitability outlook for the prior fiscal year. It still expects long-term sales growth in constant currency in the high single digits. It now sees a gross margin target of 36% to 40% from the previous target of 35% to 37%. It also revised its operating margin target which is now 11% to 14% versus the previous target of 10% to 12%.

Energy

Dow Jones US Energy Fund (IYE) was flat and Energy Select Sector SPDR (XLE) was down 0.4%.

Baytex Energy (BTE) reported it swung to a net loss per diluted share of CAD0.42 ($0.31) for Q4, from net income per diluted share of CAD0.32 for the same period last year. Analysts, however, were looking for net loss per diluted share of only CAD0.04. Petroleum and natural gas sales were CAD358.4 million, an increase from last year's CAD303.2 million. Two analysts were looking for CAD318.1 million. During the quarter, the company produced 98,890 barrels of oil equivalent per day (boe/d). For the same period a year earlier, it produced 69,556 boe/d. The company said capital expenditures are on pace for $155 million in Q1. Approximately 80% of its capital program is directed to its high operating netback light oil assets in the Eagle Ford and Viking.

Commodities

Crude was down 1.0%. United States Oil Fund (USO) was down 1%. Natural gas was down 0.7% while the United States Natural Gas Fund (UNG) was down 0.7%.

Gold was up 0.05%. SPDR Gold Trust (GLD) was down 0.02%. Silver was up 0.03%, while iShares Silver Trust (SLV) was inactive.

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 down 0.6%.

Sarepta Therapeutics (SRPT) was down 4% after it said late Tuesday it has priced an underwritten public offering of 2.6 million shares of common stock at a price of $144 per share, or a 3.2% discount from the stock's previous close, for total expected gross proceeds of $375 million. The underwriters have been granted a 30-day option to purchase up to an additional 390,625 shares. The deal is expected to close on or about March 7, subject to customary closing conditions.

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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