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Mid-Day ETF Update: ETFs, Stocks Build on Gains as Major Benchmarks Hit Fresh Record Highs; FOMC Meeting Minutes Still Ahead

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

SPDR S&P 500 ( SPY ): +0.5%

SPDR Select Sector Fund - Financial ( XLF ): +0.2%

iShares MSCI Emerging Index Fund ( EEM ): +0.8%

VanEck Vectors Gold Miners ETF ( GDX ): -1.1%

PowerShares QQQ Trust, Series 1 ( QQQ ): +0.8%

Broad Market Indicators

Broad-market exchange-traded funds, including IWM and IVV were firmer. Actively traded PowerShares QQQ ( QQQ ) was up 0.8%.

U.S. stocks extended their gains into the session's half, with the three major benchmark averages setting all-time highs on bullish manufacturing data, and analyst upgrades in the technology sector.

The Institute for Supply Management (ISM) manufacturing index. The December ISM rose to 59.7 -- its second highest level since 2004 -- from November's 58.2, and exceeded expectations to decline to 58.0.

Additionally, construction spending was up a better-than-expected 0.8% in November, beating forecasts for a 0.6% gain.

The technology sector posted strong gains, driven by a pair of upgrades to International Business Machines (IBM) and Oracle (ORCL), driving shares in the software sector higher, and offsetting heavy losses for component stock Intel (INTC) on claims that its processors present a security risk to major operating systems.

Focus is now shifting to the final minutes of the Federal Open Market Committee meeting of 2017, which will be out at 2 pm ET. Investors are hoping the minutes would provide hints as to how many times interest rates will increase in 2018.

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 higher.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was up 0.9%, while Semiconductor Sector Index Fund (SOXX) was up 1.1%.

BlackBerry (BB) shares were more than 9% higher after the company said it will collaborate with Baidu (BIDU) to accelerate the deployment of connected and autonomous vehicle technology for automotive original equipment manufacturers and suppliers worldwide. Under the agreement, BlackBerry QNX's ISO26262 ASIL-D certified safety operating system will be the foundation for Baidu's Apollo autonomous driving open platform. Also, BlackBerry and Baidu will work together to integrate Baidu's CarLife, a smartphone integration software for connected cars in China, as well as its conversational AI system DuerOS, and high definition maps to run on the BlackBerry QNX Car (Infotainment) Platform.

Winners and Losers

Financial

Select Financial Sector SPDRs ( XLF ) was up 0.2%, Direxion Daily Financial Bull 3X shares (FAS) was up 0.7% and its bearish counterpart FAZ was down 0.7%.

Carroll Organization and PGIM Real Estate, a subsidiary of Prudential Financial (PRU), formed a joint venture to acquire a multifamily portfolio that includes 28 properties across Florida, North Carolina, Tennessee and Texas from an affiliate of Lone Star Funds. Most of the assets in this portfolio are within close proximity to employment centers in major metropolitan markets and offer rent levels that do not compete with new supply. All the newly acquired properties will be managed by Carroll Management Group. Financial terms of the deal weren't disclosed. PRU shares rose 0.1%.

Energy

Dow Jones US Energy Fund (IYE) was up 1.3% and Energy Select Sector SPDR (XLE) was up 1.4%.

American depositary receipts of Petroleo Brasileiro S.A.- Petrobras (PBR, PBR.A) rose nearly 2% after the oil company agreed in principle on a $2.95 billion settlement in a class action lawsuit. The company agreed settle the securities class action lawsuit filed in the US District Court for the Southern District of New York, intending to resolve all pending and prospective claims by purchasers of Petrobras securities in the US and by purchasers of Petrobras securities that are listed for trading in the US. Under the proposed settlement, Petrobras has agreed to pay $2.95 billion to resolve claims in two installments of $983 million and a last installment of $984 million. The first installment will be paid within 10 days of preliminary approval of the settlement by the court. The second installment will be paid within 10 days of final approval of the settlement. The third installment will be paid by the later of six months after final approval, or Jan. 15, 2019. The total settlement amount will be recognized in Q4 of 2017. companies and individuals.

Commodities

Crude was down 1.8%. United States Oil Fund (USO) was up 1.7%. Natural gas was down 2.3% while United States Natural Gas Fund (UNG) was down 2% .

Gold was up 0.1%. SPDR Gold Trust (GLD) was down 0.1%. Silver was up 0.3%, while iShares Silver Trust (SLV) was up 0.2%.

Consumer

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

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 positive.

General Motors Company (GM) rose 2.4% after the company said December U.S. sales fell 3.3% to 308,539 vehicles from a year earlier, weighed down by a 2.9% decline in Chevrolet sales and a 28.6% drop in Cadillac sales. Sales of GMC rose 1.2% and Buick sales were up 4.7%. Retail sales rose 1.8% to 254,449 vehicles.

Health Care

Health care funds Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones U.S. Healthcare (IYH), were higher. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 1.6%.

Invivo Therapeutics (NVIV) reported the latest results from The INSPIRE Study, with the primary endpoint of improvement in ASIA Impairment Scale (AIS) grade from baseline for all evaluable patients at the six-month visit. Nineteen patients have been implanted with the Neuro-Spinal Scaffold. Three patients died within two weeks of implantation. The 16 evaluable patients have now all reached the six-month primary endpoint visit. Seven of the 16 (43.8%) evaluable patients had an AIS grade improvement from baseline at six months. The Objective Performance Criterion (study success definition) for the study was a 25% AIS conversion rate based on the published conversion rates for thoracic spinal cord injury (SCI) reported in the literature.

In July 2017, enrollment of patients in the INSPIRE study was placed on hold following the third patient death. Although InVivo and the respective site principal investigators believe these deaths were not related to the Neuro-Spinal Scaffold investigational device, the company is in discussions with the FDA to ensure that these cases have been comprehensively evaluated and to ensure that all appropriate risk mitigation measures have been implemented. As part of those ongoing discussions, InVivo has proposed a randomized controlled trial to supplement the existing clinical evidence for the Neuro-Spinal Scaffold. InVivo does not anticipate reopening enrollment in INSPIRE and expects to provide additional clarity on its clinical path forward in the second quarter of 2018.

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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