ETF Preview: ETFs, Futures Point Higher as Focus Remains on China; Services, Manufacturing, Home Sales Data Still Ahead

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

SPDR S&P 500 ( SPY ): +0.02%

iShares MSCI Emerging Index Fund ( EEM ): +0.5%

iPath Series B S&P 500 VIX Short-Term Futures ETN ( VXXB ): -0.8%

ProShares UltraPro Short QQQ ( SQQQ ): +0.2%

Invesco QQQ Trust, Series 1 ( QQQ ): -0.03%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV, were weaker. Actively traded PowerShares QQQ ( QQQ ) were down 0.03%.

US stock futures were pointing to modest gains ahead of the opening bell, as focus on the US-China trade deal continued, with investors also mulling data on China's economy.

Beijing had issued a 6.0% to 6.5% gross domestic product (GDP) growth target for 2019, a little below the 6.6% actual growth seen in 2018. Chinese officials also unveiled a new round of tax cuts of about $298 billion to businesses and industry at the National People's Congress in Beijing.

On the economic calendar at 9:45 am ET is the February reading of the PMI services index, followed at 10 am ET by new home sales, and the ISM non-manufacturing index.

The earnings season is winding down but a few large retailers are in the spotlight after reporting their financial results late Monday or early in Tuesday's pre-market. Kohl's (KSS), L Brands (LB) and Target (TGT) were higher after reporting upbeat Q4 results.

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.

Target (TGT) rose more than 6% after reporting better-than-expected earnings for the three months ended Feb. 2, while providing guidance for fiscal Q1 and 2019. Adjusted EPS was $1.53, up from $1.36 for the same period last year, exceeding the Capital IQ consensus by a cent. Sales were unchanged year-over-year at $23 billion and in line with the average analyst estimate compiled by Capital IQ. For fiscal Q1, the company expects a low- to mid-single digit increase in comparable sales and adjusted EPS in the range of $1.32 - $1.52. For fiscal 2019, it expects a low- to mid-single digit increase in comparable sales and adjusted EPS of $5.75 - $6.05. Analysts polled by Capital IQ are expecting adjusted EPS of $1.43 in fiscal Q1 and $5.39 for fiscal 2019.

Winners and Losers


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%.


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.

ADRs of Finnish network technology company Nokia (NOK) rose 0.5% after it said late Monday it has been selected by Indonesian telecommunications provider Indosat to upgrade its IP/MPLS network for its fixed and mobile broadband services. The selected suite will include Nokia IP Anyhaul, Nokia 7750 SR-12e platforms upgraded with the FP4 network processor, as well as additional installation of the new generation of FP4-equipped 7750 SR systems.


Dow Jones US Energy Fund (IYE) was flat and Energy Select Sector SPDR (XLE) was up 0.2%.

Goodrich Petroleum (GDP) fell more than 6% after i t report ed Q4 earnings of $0.58 compared to a net loss of $0.17 per share in the year-ago quarter. Analysts were expecting earnings of $0.43 per share for the December quarter. The energy exploration company generated oil and gas revenues of $33.9 million, which is up from $11.1 million in the comparable period in 2017 and slightly above the analyst consensus of $33.1 million.


Crude was up 1%. United States Oil Fund (USO) was up 0.4%. Natural gas was up 0.2% while the United States Natural Gas Fund (UNG) was up 0.8%.

Gold was down 0.06%. SPDR Gold Trust (GLD) was down 0.1%. Silver was up 0.05%, while iShares Silver Trust (SLV) was up 0.2%.

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 up 0.9%.

NanoViricides (NNVC) rose more than 23% after it said that NV-HHV-101, its first broad-spectrum drug candidate in the HerpeCide program, successfully completed the first of the safety/toxicology studies moving towards human clinical trials. The drug candidate is formulated as a dermal topical cream. The first part of the IND-enabling safety/toxicology studies consisted of a non-GLP evaluation of safety and tolerability of the drug candidate in mini-pigs. In the study, all dosage levels of the drug, including the maximum feasible dose, were well tolerated in all treated animals. All of the parameters evaluated in the study remained within normal ranges, and did not show any adverse effects from the drug treatment. The company said that the strong safety results are consistent with its previous studies and form the basis for progressing the drug candidate into more formal GLP safety/toxicology studies. NanoViricides is negotiating with BASi, the independent contract research organization that performed the study on NV-HHV-101, for the earliest possible date for starting the GLP phase of the IND-enabling studies. The company said that if the the GLP studies are also successful, it plans to advance NV-HHV-101 into human clinical trials for topical dermal treatment of the shingles rash as the initial indication.

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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