ETF Trading Report: Hong Kong, MLP ETFs In Focus


Stocks again slumped in Tuesday trading as weakness in some key earnings reports set the bearish mood for the day. The Dow finished off 0.8% while the Nasdaq and the S&P 500 both slumped by 0.9% as well.

Severe weakness was seen in the tech segment, led by a 5.9% decline in Cisco (CSCO), while UPS and Eli Lilly (LLY) both slumped by more than 4% as well. Seemingly, consumer goods and financials held up better than most, although these segments broadly finished in the red as well (see Three Defensive ETFs for a Bearish Market).

Thanks to this risk off trade, as well as more European worries, the U.S dollar had another strong day while the 10 Year Treasury bond fell to a yield of just 1.4%. Commodities were also under some pressure on the session as grains fell thanks to some much needed rain, although oil and gold did stay in the positives.

ETF trading was surprisingly solid during Tuesday as many of the major products saw higher than normal trading volumes. This was especially the case in some of the key commodity funds, while mid caps and broad markets also saw more shares than usual change hands.

In particular, ETF investors saw the iShares MSCI Hong Kong Index (EWH) trade on outsized volume. The ETF usually does about 2.7 million shares on a normal day although this spiked to just over 7.3 million during Tuesday trading (see Hong Kong ETF Investing 101).

A large chunk of this interest came in the final hour of the session as this is where most of the volume was concentrated. This included a 1.8 million share block, and a few half million share moves as well.

Investor interest in the final hour helped to push the fund back to breakeven to close out the day. This was also partially due to reports from the city that the recent typhoon wasn’t nearly as bad as some feared, helping to lower risk levels when investing in this special administrative region of China.  

Another ETP which saw a great deal of interest was the Credit Suisse Cushing 30 MLP Index ETN (MLPN). This product usually does just about 96,000 shares in volume but saw a huge spike in interest to just over 820,000 shares today (see Oil Bull Market Is No Place For MLP ETF Investors).

Block trading did dominate the note’s trading profile during Tuesday’s session while most of the volume was concentrated in the final few hours of the session. Still, the product finished the day down 1.3%, although much of the volume came in after these losses. Clearly, some investors are once again looking to this space for income and relative safety during this turbulent market environment.

(see more in the Zacks ETF Center)

Read the analyst report on EWH

Read the analyst report on MLPN

Read the analyst report on CSCO

Read the analyst report on UPS

Read the analyst report on LLY

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