Active broad-market exchange-traded funds at mid-day:
SPDR S&P 500 ETF Trust ( SPY ): -0.02%
Financial Select Sector SPDR ( XLF ): -0.44%, nearing its 52-week high
iShares MSCI Emerging Markets Index ( EEM ): -0.89%
Shares MSCI Japan Index ( EWJ ): -0.01%
iShares Russell 2000 Index ( IWM ): -0.38%
Broad Market Indicators
Broad-market exchange-traded funds, including SPY, IWM, IVV and others, are weaker. Actively traded PowerShares QQQ (QQQ) is down 0.06%.
U.S. stocks have slipped into negative territory in the session's half. The financial sector is leading the retreat, weighed by Wells Fargo's (WFC) report that its interest margin declined despite better-than-expected profit for Q4. Markets have been hard-pressed to find direction in earlier trade, showing little reaction to the latest trade balance and export/import prices. The import price index declined 0.1% in December; export prices also declined 0.1% for the month. For 2012, overall import prices slipped 1.5%, while export prices rose 1.1%. Both figures represent the lowest change since 2008, according to Market Watch. Meanwhile, the Department of Commerce reported that the trade deficit widened 15.8% to $48.7 billion in November - the largest deficit since April.
Winners and Losers
Tech ETFs are inching up: Technology Select Sector SPDR ETF (XLK), up 0.07% iShares Dow Jones US Technology ETF (IYW), up 0.04%; iShares S&P North American Technology ETF (IGM), up 0.23%; and iShares S&P North American Technology-Software Index (IGV), up 0.29%.
Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) is down 0.06% while Semiconductor Sector Index Fund (SOXX) is up 0.42%.
SPDR S&P International Technology Sector ETF (IPK) is up 0.37%, near its 52-week high.
In sector news, Unwired Planet (UPIP) is now up 31.30% after the company announced in yesterday's after-hours session that it entered into a patent purchase agreement with Ericsson (ERIC) whereby Ericsson will transfer to UPIP 2,185 issued US and international patents and patent applications. The transferred patents significantly broaden UPIP's Mobile Internet-focused portfolio and include 753 United States issued patents related to 2G, 3G and LTE technologies. ERIC shares closed at $10.28.
Industrial ETFs are lower, but mostly near 52-week highs: Vanguard Industrials (VIS), down 0.23%; iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ), down 0.21%; and Select Sector SPDR-Industrial (XLI), down 0.23%.
Among stocks, KBR, Inc. (KBR) is down 8.47%, trimming earlier gains, after it lowered its guidance for FY12, expecting EPS of $1.95 - $2.10, ex one-time items, down from the previous range of $2.60 - $2.80. Analysts polled by Capital IQ are looking for EPS of $2.65. For FY13, it sees EPS of $2.45 - $2.90. Included in the guidance are capital expenditures, expenses, and effective tax rate. This may not be comparable to the analyst estimate of $2.97, as Street expectations often exclude one-time items.
Dow Jones U.S. Energy Fund (IYE) and Energy Select Sector SPDR (XLE) are both up 0.01%.
In sector news, Chevron Corp. (CVX) is up 1.26% after it said late Thursday in its interim update that earnings for Q4 2012 are expected to be notably higher than Q3 2012. Upstream results are projected to be higher between sequential quarters, reflecting increased gains on asset transactions and higher liftings. Downstream earnings in the fourth quarter are also expected to be higher, largely reflecting a positive swing in timing effects, despite a sharp decline in industry refining margins.
Crude was down 0.66%; natural gas was up 2.87%. United States Oil Fund (USO) is down 0.7%. United States Natural Gas Fund (UNG) is up 3.45%.
Gold was down 1.37% and silver was down 2.10%. Among rare metal funds, SPDR Gold Trust (GLD) is down 1.02%; iShares Silver Trust (SLV) is down 1.75%.
Healthcare ETFs are lower: Health Care SPDR (XLV), down 0.12%, but with a new 52-week high of $41.88; Vanguard Health Care ETF (VHT), down 0.12%; and iShares Dow Jones US Healthcare (IYH), down 0.16%. Both VHT and IYH are nearing their 52-week highs. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) is down 1.08%.
In corporate news, ArQule, Inc. (ARQL) is down 15.07% after it announced that it did not meet the primary endpoint of its randomized Phase 2 signal generation trial of tivantinib (ARQ 197) used in combination with irinotecan and cetuximab in patients with refractory or relapsed colorectal cancer (CRC).
Although the trial did not meet its primary endpoint of Progression-Free Survival (PFS), the analysis of the patients enrolled (n=122) showed that median PFS was 8.3 months in the experimental arm (patients treated with irinotecan and cetuximab plus tivantinib), compared with 7.3 months in the control arm (patients treated with irinotecan and cetuximab plus placebo) (hazard ratio = 0.85, 95% CI: 0.55, 1.33).
Consumer ETFs are higher: Consumer Staples Select Sector SPDR (XLP), up 0.25%; iShares Dow Jones US Consumer Goods (IYK), up 0.04%, with a new 52-week high of $77.65; and Vanguard Consumer Staples ETF (VDC), up 0.11%.
Retail ETFs are mixed: SPDR S&P Retail (XRT), down 0.15%; PowerShares Dynamic Retail (PMR), down 0.32%; and Market Vectors Retail ETF (RTH), up 0.11%, with a new 52-week high of $44.49.
In sector news, Pacific Sunwear of California (PSUN) is now up 6.45% after the beachwear retailer reported that Q4 same store sales increased 1% on a continuing operations basis. It now expects non-GAAP loss per share from continuing operations to be at the lower end of its previously announced guidance range of $0.09 -$0.17, compared to $0.20 loss per share in the same quarter of 2011. Analysts are expecting a loss of $0.11 per share.
Power Play -
Financial shares are leading the markets' retreat in mid-day action after Wells Fargo (WFC) reported that its Q4 net interest margin declined, despite better-than-expected profit. It reported that its Q4 net interest margin declined to 3.56% compared to 3.89% a year ago and from 3.66% in the third quarter. Q4 earnings were $0.91, vs. the analyst consensus of $0.88 per share on Capital IQ, if comparable. Revenue was $21.9 bln, vs. expectations of $21.29 bln.
In separate news, the firm was found liable in a suit alleging the firm of civil fraud, misrepresentation, breach of contract and other misdeeds, according to a report by Reuters late Thursday. A securities arbitration panel has ruled that Wells Fargo Advisors must pay $1.3 million to investors, a California couple, for losses incurred in a strategy that included a $5 million loan and a "risky type of exchange-traded fund."
WFC is down 1.38%.
Among financial ETFs, Select Financial Sector SPDRs ( XLF ) is down 0.44%, but near its 52-week high. Direxion Daily Financial Bull 3X shares (FAS) is down 1.10%. Its bearish counterpart, FAZ, is up 1.07%.
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