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ETF News And Commentary

American stocks began the week on a winning note, although many of the gains evaporated on a light volume day in the final hour of the session. Thanks to this trend, the Dow and S&P 500 finished the day higher by just 0.2% each, while the Nasdaq held up a little better, adding 0.7% to start the week.

In terms of sector performances, no one segment stood out, although big banks, tech, and smaller oil firms all were among the leaders. On the downside, big pharma, staples, and utilities were seen leading the way, while some of the smaller financial firms were also in the red during the first session of the week.

Still, the dollar was pretty much flat against many of the world’s major currencies while European bond rates declined across the board in both the safe haven and risky economies in the region. Meanwhile, commodities were surprisingly resilient on the day, as crude oil added about 0.7% while gold also rose, but just by $4/oz. in Monday trading (read Beyond Corn: Three Surging Commodity ETFs).

In the world of ETFs, volume was shockingly light for many of the top products, as SPY, GLD, and QQQ, all saw volume less than half of their usual averages. However, volume wasn’t that light across the entire segment, as a few European funds, currency ETFs, and bond products traded more than normal in Monday’s session.

One fund that saw a great deal of added volume was the iShares S&P Developed Markets ex U.S Property Index Fund (WPS - ETF report). This product usually does just over 19,600 shares in volume but saw a spike to over 330,000 shares in Monday trading (See Real Estate ETFs: Unexpected Safe Haven).

However, investors should note that heavy block trading at the beginning of the session made up the vast majority of this daily volume, leaving just a smattering of shares to change hands over the next several hours. Still, the fund didn’t really move that much higher on the volume increase, adding 0.5% on the day. While this was enough to beat out others in the space, it did help propel WPS even closer to its 52 week high.

Another ETF that saw a great deal of interest was the iShares MSCI EMU Index Fund (EZU - ETF report). This product usually has volume just over 465,000 shares but saw more than 2.8 million shares move hands during this session (read Play Europe with this ETF Pair Trade).

This volume increase as well as the solid performance out of the Spanish market undoubtedly were some of the main drivers for EZU’s 1.3% gain on the day. It also didn’t hurt that bond yields fell below 6% for Italy while they slide under the 6.75% mark for Spain, suggesting less worries over these troubled countries and more demand for equities, at least for now.

(see more in the Zacks ETF Center)

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