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Mid-Day ETF Update: ETFs, Stocks Higher as Street Shrugs Off Concerns for Possible Fed Interest Rate Hikes

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

SPDR S&P 500 ( SPY ): +1%

iShares MSCI Emerging Index Fund ( EEM ): +1%

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

ProShares Trust Ultra VIX Short Term Futures ETF ( UVXY ): -6.4%

Barclays Bank PLC iPath S&P 500 VIX Short-Term Futures ETN ( VXX ): -3.2%

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 rebounded at session's half, with the energy and industrial sectors leading gainers. Wall Street brushed aside the hawkish spin to the January minutes of the Federal Open Market Committee meeting and the ensuing freefall in stocks with assurances by St Louis Fed president James Bullard that economic conditions would need to be ideal for four rate increases. Treasury yields backed off their four-year highs overnight, and the dollar's four-day rally against the yen was squashed.

In economic data news, initial jobless claims fell to 222,000 first-time applicants during the week ended Feb. 27, down from a downwardly revised 229,000 claims during the prior seven-day period and beating the Econoday consensus looking for around 230,000 initial claims last week. Continuing claims declined by 73,000 during the seven days ended Feb. 10 from the previous week to 1.875 million applicants while the four-week average fell by 16,250 to 1.927 million claims.

Also, leading economic indicators were higher by 1.0% in January, exceeding estimates for a 0.6% gain, and the Kansas City Fed manufacturing index improved to 21 from 16, versus 16.5 estimates.

Power Play: Energy

Dow Jones US Energy Fund (IYE) was up 2.3% and Energy Select Sector SPDR (XLE) was up 2.3%.

Whiting Petroleum's (WLL) rose more than 26% after the company reported adjusted net loss narrowed to $0.17 a share in Q4 from $1.12 a share a year earlier, a sharply lower loss than Capital IQ poll of a loss of $0.30 per share. Revenue rose to $474.41 million from $342.70 million a year ago, exceeding the $424.55 million estimate. It expects production of 11.1 to 11.6 MMBOE for Q1 and 46.5 to 47.2 for the full year. In Q4, production was 11.78 MMBOE.

Winners and Losers

Financial

The Select Financial Sector SPDRs ( XLF ) was up 0.5%. Direxion Daily Financial Bull 3X shares (FAS) was up 1.7% and its bearish counterpart Direxion Daily Financial Bear 3X shares (FAZ) was down 2%.

VeREIT (VER) rose almost 2% to a session high of $6.87 a share after the real estate investment trust reported in line non-GAAP Q4 funds from operations and revenues exceeding Wall Street estimates for the final three months of 2017. Excluding one-time items, the company generated adjusted FFO of $0.18 per share, rising a penny above its year-ago metric and in-line with the Capital IQ consensus. Revenue fell to $316.6 million during the three months ended Dec. 31 from $327.3 million during the same quarter last year but topping the $284.8 million analyst mean. Looking forward, VeREIT is projecting adjusted FFO in a range of $0.70 to $0.72 per share, straddling the $0.71 per share Street view.

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 firmer. Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was up 0.8% and Semiconductor Sector Index Fund (SOXX) was up 0.4%.

VASCO Data Security International (VDSI) fell more than 11% after the firm reported Q4 adjusted earnings of $0.14 per share, down from $0.16 per share a year ago, but four cents about the Capital IQ consensus estimate. On a GAAP basis, the company reported a loss of $0.65 per share versus a profit of $0.13 for the same quarter last year. Total revenue of $54.5 million increased from $47.6 million a year ago, beating the estimated $50.3 million.

For 2018, the company expects revenue to be between $197 million and $207 million, straddling Wall Street's estimates of $201.4 million.

Commodities

Crude was up 1.7%. United States Oil Fund (USO) was up 3.1%. Natural gas was up 0.1% while United States Natural Gas Fund (UNG) was up 0.2%.

Gold was up 0.01%. SPDR Gold Trust (GLD) was up 0.5%. Silver was up 0.1%, while iShares Silver Trust (SLV) was up 1.2%.

Health Care

Health care funds Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones U.S. Healthcare (IYH), were firmer. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.5%.

Clovis Oncology (CLVS) firms 8% after the company said late Wednesday the European Union's (EU) European Medicines Agency (EMA) CHMP has communicated a positive trend vote for the rucaparib Marketing Authorization Application as monotherapy to treat a limited population of advanced ovarian cancer patients with deleterious BRCA mutation. It intends to hold a final vote on the treatment indication at the March 19-22 meeting.

Consumer

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

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 in the green.

Bloomin' Brands (BLMN) reported fiscal Q4 adjusted net income of $0.41 per diluted share, up from $0.29 in the prior-year period.The result came in higher than the $0.39 per share Street estimate provided by Capital IQ. Revenue for the period ended Dec. 31 was $1.09 billion, up from $1 billion reported for the same period last year. That was higher than the $1.05 billion Street estimate. For fiscal 2018, the company expects adjusted earnings of $1.38 to $1.45 per diluted share. The Street consensus calls for earnings of $1.40 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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