Mid-Day ETF Update: Struggle to Keep in the Black as Oil Prices Slump Again; Fed Speakers Still Ahead

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

iShares MSCI Emerging Index Fund ( EEM ): -1.1%

Market Vectors Gold Miners ETF ( GDX ): -6%

SPDR S&P 500 ( SPY ): +0.03%

iShares MSCI Brazil Capped Index Fund ( EWZ ): -3.2%

iPath S&P 500 VIX ST Futures ETN ( VXX ): -1.9%

Broad Market Indicators

Broad-market exchange-traded funds, including SPY, IWM and IVV were higher. Actively traded PowerShares QQQ (QQQ) was up 0.3%.

U.S. stocks were still in positive territory but struggling to hold on to gains as another decline in crude oil prices weighed on market sentiment and put pressure on the energy and materials sectors.

Crude oil prices took another hit following news that Saudi Arabia's energy minister, Ali al-Naimi was dismissed from his position. A production freeze from the Organization of the Petroleum Exporting Countries is now looking unlikely.

With no major economic data on tap, investors are likely looking to Federal Reserve officials who will give speeches later today. Minneapolis Fed President Neel Kashkari will speak at the Economic Club of Minnesota at 1 pm ET. Meanwhile, San Francisco Fed President John Williams will be answering questions in a session on Quora - a question-and-answer website - at 6 pm ET.

Power Play: Consumer

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

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 also higher.

Krispy Kreme Doughnuts (KKD) was up 24.1% after it agreed to be acquired by JAB Beech Inc. for $21 per share in cash, or a total value of approximately $1.35 billion. The deal has been unanimously approved by Krispy Kreme's board, and represents a premium of approximately 25% over the company's closing stock price on May 6. There are more than 1,100 Krispy Kreme outlets in more than 26 countries worldwide.

Winners and Losers


Select Financial Sector SPDRs (XLF) was down 0.2%. Direxion Daily Financial Bull 3X shares (FAS) was down 0.2% while its bearish counterpart, FAZ, was up 0.3%.

LendingClub (LC) was down 26.1% and touched a fresh record low after the online marketplace connecting borrowers and investors said its CEO and Chairman Renaud Laplanche has resigned. The company said Laplanche's resignation comes in the wake of an internal review of sales of $22 million in near-prime loans to a single investor, in contravention of the investor's express instructions as to a non-credit and non-pricing element, in March and April 2016. The company said Scott Sandborn will continue in his role as president and will also become acting CEO, supported by board member Hans Morris, who has assumed the newly created role of executive chairman.

Meanwhile, LendingClub reported a Q1 adjusted EPS of $0.05 per share, up from $0.02 a year ago and in line with the average estimate from analysts polled by Capital IQ. Revenue rose to $151.3 million from $81 million, driven mostly by a surge in transaction fees, and topping the $147.9 million consensus.

The company said that in light of the events, it wouldn't be "prudent" to provide a guidance. It said it is taking steps to resolve weaknesses in internal control and financial reporting and said it will file a request with the Securities and Exchange Commission to file its quarterly report on form 10-Q for Q1 on or before May 16.


Tech funds were firmer, ahead of the broader market. 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. Meanwhile, SPDR S&P International Technology Sector ETF (IPK) was down 2.2%.

Among semiconductor ETFs, SPDR S&P Semiconductor (XSD) was down 0.5% and Semiconductor Sector Index Fund (SOXX) was down 0.3%.

TowerJazz (TSEM) was up 4.3% after it reported a Q1 adjusted net income of $31.6 million, or $0.31 per fully diluted share, compared to a loss of $7.5 million, or a loss of $0.03 per share, in the prior year period. Analysts were expecting earnings of $0.67 per share on an adjusted basis. Total revenues of $278 million were up from $254.6 million in Q1 2015 and topped analyst projections of $276 million. The company guided Q2 revenues at $300 million, with an upward or downward range of 5%. The guidance implies a range of $285 million to $315 million, straddling the Street estimate of $289 million.


Industrial funds were slightly lower, behind the broader market. Select Sector SPDR-Industrial (XLI), Vanguard Industrials (VIS) and iShares Trust Dow Jones U.S. Industrial Sector Index Fund (IYJ) were in negative territory.

Ritchie Bros. (RBA) was up 4.3% after it reported Q1 adjusted earnings of $39.2 million, or $0.27 per diluted share, up from last year's $33 million, or $0.22 per diluted share, exceeding the Capital IQ consensus of $0.21. Revenues were $131.9 million, up 14% year-over-year from $115.6 million. The mean estimate was for $116.2 million. The company will be paying a quarterly cash dividend of $0.16 per common share on June 14 to shareholders of record on May 24.


Dow Jones U.S. Energy Fund (IYE) was down 2.4%; Energy Select Sector SPDR (XLE) was down 2.4%.

Xcel Energy (XEL) was up 1.4% after it reported Q1 net income of $241.3 million, or $0.47 per share; up from $152.1 million, or $0.30 per share in Q1 2015. On an adjusted basis, net income for the quarter was $0.47 per share, up from $0.46 per share in the prior year period and came in line with the Street estimate. Revenues were $2.77 billion, down from $2.96 billion reported for the same period last year and lower than the $3 billion Street estimate. For 2016, the company expects ongoing earnings to range from $2.12 to $2.27 per share. The Street estimate calls for EPS of $2.20.


Crude was down 2.5%; United States Oil Fund (USO) was down 2.7%. Natural gas was down 0.1% and United States Natural Gas Fund (UNG) was up 0.3%.

Gold was down 2.1%, while silver was down 3%. Among rare metal funds, SPDR Gold Trust (GLD) was down 2% and iShares Silver Trust (SLV) was down 3%.

Health Care

Health care funds were modestly higher, in line with the broader market. Health Care SPDR (XLV), iShares Dow Jones US Healthcare (IYH) and Vanguard Health Care ETF (VHT) were in the red. Biotech ETF iShares NASDAQ Biotechnology Index (IBB) was up 2.3%.

Unilife Corp. (UNIS) was down 29.6% to a new record low after the company said it is postponing its fiscal Q3 earnings call due to the discovery of violations in policies and procedures made by its current management team. The company also said its former CEO and board chairman may have violated certain laws and regulations. Originally, the Q3 earnings call was scheduled for 8:00 am ET on Monday. Unilife said it is currently investigating these matters and their potential impact on financial reporting, and it has not yet discovered any financial losses. The company said it plans to delay filing its Form 10-Q for the period ended March 31 and file a notification of late filing on Form 12b-25.

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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