Mid-Day ETF Update: ETFs, U.S. Stocks in Positive Territory as Energy Sector Gains Offset Higher 10-Yr Treasury Note

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

iShares MSCI Emerging Index Fund ( EEM ): -0.2%

SPDR S&P 500 ( SPY ): +0.6%

VelocityShares Daily 2x VIX Short Term ETN ( TVIX ): -5.3%

SPDR Select Sector Fund - Financial ( XLF ): +1.1%

SPDR Select Sector Fund - Energy Select Sector ( XLE ): +2.4%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were lower. Actively traded PowerShares QQQ (QQQ) was up 0.6%.

U.S. stocks were in positive territory at session's half, with Wall Street kept afloat by higher oil prices while the 10-year Treasury note continues to flirt with the 3.0% "sell trigger."

Oil is trending higher for a fifth straight day with West Texas Intermediate at another three-and-a-half year high in the wake of President Donald Trump's decision on Tuesday to end U.S. participation in the Iranian nuclear agreement.

In economic data news, wholesale prices were up by just 0.1% in April, below the consensus estimate for a 0.3% increase. Excluding the volatile food and fuel segment, the producer price index increased by just 0.2%, in-line with estimates but lower than the 0.3% gain the month prior.

Wholesale inventories and sales were both up 0.3% in March, but below expectations. The inventory/sales ratio remained unchanged at 1.28.

Power Play: Energy

Dow Jones US Energy Fund (IYE) was down 0.4% and Energy Select Sector SPDR ( XLE ) was down 0.4%.

Transocean (RIG) rose more than 7% after the company said that, through a joint venture with Hayfin Capital Management, it has acquired a 33.3% interest in the harsh environment newbuild semi-submersible West Rigel. The company initially invested $83 million in the joint venture, plus another $8 million for working capital, with an additional $83 million to be invested at a later date. The $500 million rig is expected to be delivered in Q4, and available for charter in Q1 2019.

Winners and Losers


The Select Financial Sector SPDRs ( XLF ) was up 0.6%. Direxion Daily Financial Bull 3X shares (FAS) was up 1% and its bearish counterpart Direxion Daily Financial Bear 3X shares (FAZ) was down 1%.

Capital One Financial (COF) rose more than 2% after the firm said it will sell approximately $17 billion of first and second lien mortgages to DLJ Mortgage Capital, Inc., a subsidiary of Credit Suisse (CS). The company expects to close the deal and record a gain from the sale in Q2 2018. As a result of the sale, Capital One said it now anticipates to resume its share buyback program through the end of Q2 under its existing authorization.


Technology Select Sector SPDR ETF (XLK) was up 0.1% while other tech funds 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 lower.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was down 0.1% and Semiconductor Sector Index Fund (SOXX) was up 0.3%.

ADRs of Weibo Corporation (WB) were down nearly 14% after the social media company in China reported Q1 adjusted earnings of $0.50 per share, up from $0.26 in the same period a year ago and topping the estimate of $0.47 from analysts polled by Capital IQ. Total revenue of $349.9 million was up from $199.2 million in the same period a year ago and beat the Street projection of $343.9 million. For Q2 Weibo expects revenues between $420 million and $430 million, straddling the Street estimate of $423.9 million.


Crude was down 2.5%. United States Oil Fund (USO) was down 1.5%. Natural gas was down 0.9% while United States Natural Gas Fund (UNG) was down 0.4%.

Gold was down 0.2%. SPDR Gold Trust (GLD) was down 0.02%. Silver was down 0.4%, while iShares Silver Trust (SLV) was down 0.4%.

Health Care

Health Care SPDR (XLV) was down 0.8% and other health care funds Vanguard Health Care ETF (VHT) and iShares Dow Jones US Healthcare (IYH) were lower. Biotechnology fund iShares NASDAQ Biotechnology Index (IBB) was up 0.7%.

Endocyte (ECYT) shares rose more than 5% to the highest since April 2014 after the company reported a net loss of $0.16 per share compared with a net loss of $0.27 per share and narrower than the $0.19 loss per share expected by analysts in a Capital IQ poll. Revenue was $16,000 from $12,000 a year earlier, the biophama company said.


Consumer Staples Select Sector SPDR (XLP) was up 1.4% and other funds Vanguard Consumer Staples ETF (VDC) and iShares Dow Jones US Consumer Goods (IYK) were firmer.

Consumer Discretionary Select Sector SPDR (XLY) was up 1.2% and retail funds SPDR S&P Retail (XRT), PowerShares Dynamic Retail (PMR) and Market Vectors Retail ETF (RTH) were in positive territory.

TripAdvisor (TRIP) rose more than 22% after the online travel company posted Q1 non-GAAP earnings of $0.30 per share, compared with the prior-year period's $0.24 per share. Analysts polled by Capital IQ were expecting EPS of $0.16. Revenue was $378 million, up 2% from $372 million in the same quarter last year. The Street view was for revenue of $360.5 million.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Copyright (C) 2016 All rights reserved. Unauthorized reproduction is strictly prohibited.

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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