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Mid-Day ETF Update: ETFs, Stocks Surge Higher as Upbeat Earnings Fuel Dow's Rise to 20,000

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

SPDR Select Sector Fund - Financial ( XLF ): +1.4%

Direxion Daily Gold Miners Index Bull 3X Shares ( NUGT ): -7.6%

Direxion Daily Junior Gold Miners Index Bull 3X Shares ( JNUG ): -7.3%

SPDR S&P 500 ( SPY ): +0.7%

VanEck Vectors Gold Miners ETF ( GDX ): -2.5%

Broad Market Indicators

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

U.S. stocks were higher at session's half as the Dow Jones Industrial Average crossed the 20,000 level for the first time in the blue-chip index's history while the Standard & Poor's 500 and the Nasdaq Composite hit record highs on Wednesday afternoon trading.

The surge was spurred by strong earnings results, particularly from Dow component Boeing (BA), which jumped some 5% to a new 52-week high after reporting better-than-expected Q4 earnings and revenues while projecting fiscal 2017 above Street estimates.

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 in positive territory, each hitting a new 52-week high. SPDR S&P International Technology Sector ETF (IPK) was up 1.7%.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was up 0.9% and Semiconductor Sector Index Fund (SOXX) was up 0.9%; both also reached new 52-week highs.

Textron (TXT) was down 10.4% after it reported Q4 adjusted EPS of $0.80, down from $0.81 in the same period a year ago and falling short of the the estimate of $0.87 from analysts polled by Capital IQ. Total revenues of $3.83 billion were down from $3.92 billion in the same period a year ago and missed the Street projection of $4.01 billion. The company guided 2017 revenues at approximately $14.30 billion, shy of the Street estimate of $14.32 billion. Full year adjusted EPS is expected to range between $2.50 and $2.70, missing the Street projection of $2.92.

The company also said it agreed to acquire Arctic Cat (ACAT), a manufacturer of snowmobiles and all-terrain vehicles, for $247 million plus the assumption of debt. The company will offer $18.50 per share in a tender offer which is expected to launch no later than Feb. 7.

Winners and Losers

Financial

Select Financial Sector SPDRs ( XLF ) was up 1.4%. Direxion Daily Financial Bull 3X shares (FAS) was up 2.7%, while its bearish counterpart, FAZ, was down 2.7%.

Santander Consumer USA Holdings (SC) was down 6.2% after it reported Q4 net profit of $0.17 per share, compared to a net loss of $0.05 per share in the prior year period. Capital IQ provided a Street estimate of $0.34 per share, but it is unclear if this is comparable. Revenues were $1.08 billion, down slightly from $1.10 billion reported for the same period last year and came in lower than the $1.13 billion Street estimate.

Industrial

Industrial funds Select Sector SPDR-Industrial (XLI), iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), Vanguard Industrials (VIS) were all in positive territory and reaching new 52-week highs.

Boeing (BA) rose 5% after the company reported Q4 non-GAAP earnings of $2.47 per share, compared with the prior-year period's $ 1.60 per share. Analysts polled by Capital IQ were expecting EPS of $2.33. Revenue was $23.29 billion, down from $23.57 billion in the same quarter last year. The Street view was for revenue of $23.13 billion. The company expects fiscal 2017 non-GAAP EPS of $9.10 - $9.30 on revenue of $90.5 billion - $92.5 billion. The Street view is for EPS of $9.25 on revenue of $92.83 billion

Energy

Dow Jones U.S. Energy Fund (IYE) was up 0.7% and Energy Select Sector SPDR (XLE) was up 0.5%.

Halcon Resources (HK) surged 20.2% after it said late Tuesday it entered into an agreement to buy 20,748 net acres in the Southern Delaware Basin for $705 million with a Nov. 1, 2016, effective purchase date. Halcon also said it entered into an option agreement to purchase an additional 15,040 net acres in Ward County, Texas from a private operator for $11,000 per acre, or $165.4 million. Finally, the oil driller agreed to sell its East Texas Eagle Ford assets for $500 million, with a Jan. 1 effective date. Halcon meanwhile said it plans a private offering 5,518 shares of automatically convertible preferred stock, each share of which will be convertible into 10,000 shares of its common stock, for $400 million, or $7.25 per common share.

Commodities

Crude was up 1.4%. United States Oil Fund (USO) was up 0.2%. Natural gas was up 1.9% while United States Natural Gas Fund (UNG) was up 0.5%.

Gold was down 0.3%. SPDR Gold Trust (GLD) was down 1.2%. Silver was up 0.3% while iShares Silver Trust (SLV) was down 1.1%.

Consumer

Consumer staples funds were higher, in line with the broader market. Consumer Staples Select Sector SPDR (XLP), Vanguard Consumer Staples ETF (VDC), and iShares Dow Jones US Consumer Goods (IYK) were firmer.

Likewise, 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.

Meredith Corp (MDP) rose 9.4% to a new 52-week high after the company reported pre-market Wednesday fiscal Q2 adjusted EPS of $1.30 per share, up from $0.80 per share a year earlier and higher than the $1.20 per share consensus of analysts polled by Capital IQ. For Q2 ended Dec. 31, revenues rose to $442.6 million from $406.4 million and beat forecasts for $434.7 million. For FY17, the media and marketing firm continues to expect adjusted EPS of $3.50 to $3.80 per share, straddling the $3.69 per share average estimate. Q3 EPS is seen at $0.75 to $0.80, also straddling the $0.78 per share consensus, with revenues for each of its local and national media groups seen flat to down slightly from a year earlier.

Health Care

Health care funds were in positive territory, in line with the broader market. Health Care SPDR (XLV), Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were firmer. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.9%.

Meridian Bioscience (VIVO) fell 19% to its lowest level since November 2005 after it reported Q1 EPS of $0.15, versus $0.21 last year, missing the $0.20 average estimate from analysts polled by Capital IQ. Revenue for the quarter was $46.8 million, down from $47.2 million last year and below the $51.2 million consensus. The company revised its fiscal 2017 EPS guidance to between $0.64 and $0.69, versus prior guidance of $0.81 to $0.85. and below the $0.82 average estimate. Full-year revenues are seen at $193 million to $199 million, versus prior guidance of $205 million to $210 million and below the $206.1 million consensus. The company also reduced the annual indicated dividend rate from $0.80 per share to $0.50.

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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