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ETF Trading Report: Commodity, Industrial ETFs In Focus

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U.S. stocks had a choppy trading session to open up the week as all of the major benchmarks finished the day slightly in the red. The broader S&P 500 and Nasdaq both finished the day lower by about 0.2%, while the more concentrated Dow slumped by 0.3%.

Seemingly, many traders were on the sidelines today, awaiting the start of the summer earnings season which unofficially kicked off after the bell with Alcoa’s (AA) report. The aluminum maker had a lukewarm report as the firm was up slightly in after-hours trading but just met the Zacks Consensus Estimate of six cents a share (See 11 Great Dividend ETFs).

Beyond this, health care and some of the consumer firms were big winners on the day, while weakness continued in the basic materials, big bank, and tech corners of the market. In particular, ANR and BTU led on the downside while STX and WLP were the biggest gainers of the S&P 500 components.

Currency trading was pretty flat, as the European currencies recouped a tiny bit of their losses while the yen strengthened as well against the dollar. Still, inflows continued in the Treasury market as the 10 year bond saw yields slump to just 1.52%, a four basis point decrease for the benchmark note (read Three iPath ETNs to Watch During the Barclays’ LIBOR Scandal).

Commodity markets, however, were again favorable across the board as natural gas added more than 4% while corn continued its run, adding about 5.3% on the day. Other soft commodities were also in the green, while the only real losers on the day were in the livestock market as cattle feeder futures slumped by 1.7%.

ETF trading saw light volume across the board as investors seemingly wait for earnings season before deciding which sectors to take a closer look into. Many financial, industrial, and consumer ETFs traded at about half of the normal volume while a similar trend was seen in a number of commodity and international products as well.

On the other hand, investors did see a few products push through on outsized volume including—once again—the PowerShares DB Agriculture ETF (DBA - Free Report) . The popular ETF usually does about 875,000 shares in a normal day but surged to just over two million during Monday trading (see Buy American with these Three Commodity ETFs).

This was likely due to the continuation of hot weather and crop damaging conditions across the Midwest, forcing many analysts to revise their predictions for the harvest sharply downward. Thanks to this, DBA was up another 2.2% today, pushing the product higher by about 11.5% over the past month.

Another fund which saw outsized volume in Monday trading was the iShares Dow Jones US Industrial ETF (IYJ - Free Report) . This fund usually sees volume of about 50,000 shares in a normal day but experienced a massive spike to just over two million shares to open up this week (see Three Industrials ETFs Outperforming XLI).

Interestingly, the huge volume was largely the result of a few big block trades which accounted for almost one million shares on the day. Still, the product only lost a few cents on the day but it could be in focus later on in the week due to the heavy exposure to companies like GE, UTX, and MMM which could be volatile as more earnings data is released.

(see more in the Zacks ETF Center)

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