ETF Preview: ETFs, Futures Edge Higher as Street Digests Mixed Q1 Earnings Results from Bank of America

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

SPDR S&P 500 (SPY): +0.3%

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

iShares MSCI Emerging Index Fund (EEM): +0..6%

iShares China Large-Cap ETF (FXI): +1.6%

iPath Series B S&P 500 VIX Short-Term Futures ETN (VXXB): -0.2%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV, were inching higher. Actively traded PowerShares QQQ (QQQ) were up 0.3%.

US stock futures were modestly firmer, as investors continued to weigh the most recent earnings reports, led by Bank of America (BAC), which reported better-than-expected Q1 earnings even as revenue fell short of Street estimates.

In economic news, the March reading for industrial production will be reported at 9:15 am ET, with Econoday estimates for an increase of 0.3%, versus the prior month's 0.1%. Capacity utilization rate is expected to be 79.1%, up from the prior month's figure of 78.2%.

Meanwhile, the April reading of the National Association of Home Builders' housing market index will be out at 10:00 am ET. Econoday expectations are for 63.0, compared with the previous month's 62.0.

Power Play: Financial

The Select Financial Sector SPDRs (XLF) was down 0.5%. Direxion Daily Financial Bull 3X shares (FAS) was down 0.6% while its bearish counterpart Direxion Daily Financial Bear 3X Shares (FAZ) was inactive.

BlackRock (BLK) was up 1.6% after it reported Q1 adjusted earnings of $6.61 per share, down from $6.70 in the same period a year ago and exceeding the estimate of $6.13 from analysts polled by Capital IQ. Total revenue of $3.35 billion was down from $3.58 billion in the same period a year ago and topped the Street projection of $3.30 billion.

Winners and Losers


Technology Select Sector SPDR ETF (XLK) and 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.

AT&T (T) disclosed late Monday that it has agreed to sell its minority stake in Hulu back to the streaming video joint venture for $1.43 billion. The deal, which values Hulu at $15 billion, does not require any governmental or other third-party approvals and was simultaneously signed and closed, according to a statement. Dallas-based AT&T said it will use proceeds from the sale of its 9.5% interest in Hulu, along with additional planned sales of non-core assets, to reduce debt. Since June 2018, AT&T has been the parent company of mass media conglomerate WarnerMedia, making it the world's largest media and entertainment company in terms of revenue. T shares rose marginally in pre-market trade.


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

Chevron (CVX) said late Monday it has received a favorable ruling from the Supreme Court of the Netherlands, preventing the enforcement of a $9.5 billion Ecuadorian judgment against the company. The Ecuadorian judgment was previously found by the Permanent Court of Arbitration in The Hague, as well as by US courts, to have been obtained through "fraud, bribery, and corruption," the company said. The Ecuadorian government has been petitioning the Dutch courts to set aside arbitral awards favorable to Chevron. CVX shares rose marginally.


Crude was down 0.1%. United States Oil Fund (USO) was down 0.2%. Natural gas was flat, while the United States Natural Gas Fund (UNG) was also inactive.

Gold was down 0.13%. SPDR Gold Trust (GLD) was down 0.3%. Silver was down 0.5%, 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 US Healthcare (IYH) were flat in pre-market trade. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.6%.

Mesoblast (MESO) said pre-market Tuesday that the Food and Drug Administration has allowed the company to submit on a rolling basis a Biologics License Application (BLA) for its allogeneic cellular medicine remestemcel-L for children with steroid-refractory acute graft versus host disease (SR-aGVHD). The company said that it will submit each module of the BLA once it is completed. It expects to submit the first module to the FDA soon. Remestemcel-L as a treatment for SR-aGVHD has already received fast-track designation from the FDA and is eligible for priority review once the BLA filing is completed and accepted by the agency, Mesoblast said.


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.

Hormel Foods (HRL) said early Tuesday that it has completed the sale of its CytoSport business to PepsiCo (PEP) for $465 million, subject to working capital adjustments. According to Hormel, the sale includes its Muscle Milk and Evolve brands.

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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