ETF Preview: ETFs, Futures Weaker Following Concerns Over Greece Election; Earnings, FOMC Meeting in Focus

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

SPDR S&P 500 ETF Trust ( SPY ): -0.21%

iShares MSCI Emerging Markets Index ( EEM ): -0.32%

Market Vectors Gold Miners ( GDX ): -2.02%

iPath S&P 500 VIX Short Term Futures ( VXX ): -0.47%

PowerShares QQQ Trust, Series 1 ( QQQ ): -0.06%

Broad-Market Indicators

Most broad-market exchange-traded funds, including SPY, IWM, IVV and others, were slipping lower ahead of the open. Likewise, actively traded PowerShares QQQ ( QQQ ) was down 0.06%.

U.S. stock futures were also weaker ahead of Monday's opening, weighed down by the news over the weekend that anti-austerity Greek opposition party Syriza won the general election. This has raised concerns that Greece could lose its international assistance or leave the eurozone.

There us no data schedule for release today; investors instead are expected to focus on earnings news, with Microsoft (MSFT) and Texas Instruments (TXN) slated to report their results in the after hours session. Federal Open Market Committee meeting, beginning Tuesday, will also be in focus.

Power Play: Technology

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 inactive. SPDR S&P International Technology Sector ETF (IPK) was also unchanged.

Semiconductor ETFs SPDR S&P Semiconductor (XSD) and Semiconductor Sector Index Fund (SOXX) were flat in pre-market trading.

ChinaNet Online Holdings (CNET) was up 23.41% after it said it has launched its Business Direct 3.0 in cooperation with Baidu Direct Reach of Baidu, a Chinese language online search provider. Business Direct 3.0 is a technically marked-up service based on the Baidu Direct Reach mobile platform for traditional service enterprises, which is centered on mobile search, accounts, maps, and personalized recommendations. CNET said it expects the market will reach a potential market size of $12 billion or more.

Winners and Losers


Select Financial Sector SPDRs (XLF) was flat. Direxion Daily Financial Bull 3X shares (FAS) was down 0.23% and its bearish counterpart, FAZ, was up 0.52%.

Ocwen Financial (OCN) soared 29.92% following multiple reports the company agreed to pay $2.5 million in penalties in California and agreed to allow an independent auditor to review its mortgage servicing practice. The deal is part of an agreement with California's Department of Business Oversight and allows the company to continue to do business in the state.


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

W.W. Grainger (GWW) was down 3.9% after it reported Q4 earnings that were short of analysts' estimates and cut its guidance for 2015, citing a low inflationary environment, economic headwinds internationally and pressure from weaker currencies in Canada and Japan. The company said adjusted earnings rose 8% to $2.80 per diluted share but missed the $2.83 average estimate from analysts polled by Capital IQ. Sales rose 6% to $2.5 billion, in line with the consensus estimate. Reported earnings fell to $148.8 million or $2.14 per diluted share from $156.7 million or $2.20 the year earlier. On a FY basis, reported EPS rose to $11.45 from $11.43 but Grainger said unfavorable foreign exchange represented a $0.07 reduction to FY EPS. Grainger said it now expects 3% to 7% sales growth, down from previously expecting 5% to 9% while EPS is now expected to be between $12.60 to $13.60, down from previously $12.90 and $13.80 but still straddling the $13.47 average estimate from analysts.


Dow Jones U.S. Energy Fund (IYE) was flat while Energy Select Sector SPDR (XLE) was up 0.48% in pre-market trading.

Cliffs Natural Resources (CLF) was up 4.94% after announcing it reduced its net debt balance by more than $400 million during Q4 and has decided to eliminate the quarterly dividend of $0.15 per share for Q1 2015 and all subsequent quarters. CLF's accelerated debt reduction was achieved through the repayment of short-term debt as well as the repurchase of more than $200 million aggregate principal amount of senior notes in the open market at an average discount of 34% to par,for a total discount of approximately $70 million. Funds for the accelerated debt reduction were cash from operations generated during Q4 and net proceeds from the sale of Cliffs Logan County Coal. The elimination of the quarterly dividend is expected to provide the company with additional free cash of $92 million annually, which CLF plans to use for further debt reduction.


Crude was up 0.22%. United States Oil Fund (USO) was up 0.65%. Natural gas futures was down 2.87%. United States Natural Gas Fund (UNG) was up 2.68%.

Gold was down 0.53% while silver was down 0.9%. Among rare metal funds, SPDR Gold Trust (GLD) was down 0.63% while iShares Silver Trust (SLV) was down 1.09%.

Health Care

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 0.21%.

NovaBay Pharmaceuticals (NBY) was up 10.84% after it signed a nationwide distribution agreement with Cardinal Health (CAH), a pharmaceutical distribution company, through which CAH will carry and distribute NBY's Avenova, a prescription lid and lash hygiene product. Combined with NBY's previous distribution agreements with McKesson Corporation (MCK) and Vision Source, Avenova will now be available to more than 90% of the nation's 67,000 retail pharmacies and to thousands of optometrists' offices. NBY plans to expand its sales force to 35 representatives in the field selling Avenova by early February. NBY expects to report modest but growing initial revenues for Avenova until mid to late 2015 when the full productivity of the expanded sales effort is expected to become evident. CAH shares were flat.


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

SPDR S&P Retail (XRT) , PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were flat.

D.R. Horton (DHI) was up 6.23% after it reported Q1 results that beat the Street. D.R. Horton reported $0.39 per share, up from $0.36 per share a year prior, on $2.3 billion in earnings for Q1, versus the Street view of $0.34 per share on revenue of $2.1 billion, according to Capital IQ estimates. The company declared a dividend of $0.06 per share.

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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