ETFdb Weekly Watchlist: XRT, EWU, XLI Hinge On Consumer and Manufacturing Data

ETF Database

Following a holiday-shortened trading week, Wall Street will close once again this Wednesday in celebration of the New Year. After a whirlwind of a year, investors will more than likely turn their attention once again to the Federal Reserve, as the central bank begins tapering its bond-buying program. In January, the Fed will purchase $40 billion worth of Treasury bonds per month, and $35 billion worth of mortgage-backed securities – a $10 billion total reduction of purchases. The central bank, however, stated that it will remain highly accomodative and that asset purchases are not on a pre-set course in 2014.

This week, investors will only see a handful of economic reports. Below, we outline three ETFs that should see a fair amount of activity during the week ahead [see The Fed Effect: How Monetary Policy Impacts Your ETFs].

1. SPDR S&P Retail ETF (XRT, A)

Why XRT Will Be In Focus:  This ETF tracks an index that is comprised of the roughly 100 U.S.-listed, publicly-traded retail companies, a targeted sub-sector of the consumer discretionary space. Investors should keep a close eye on XRT on Tuesday as the Conference Board reports its consumer confidence index. In its previous recording, the index came in at 70.4, missing analyst expectations of 72.2  [see Single Country ETFs: Everything Investors Need To Know].

2. MSCI United Kingdom ETF (EWU, A)

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Industrial

Why EWU Will Be In Focus: This ETF tracks an index that is comprised of roughly 100 securities, and it is designed to measure the overall performance of the British equity market. Investors should keep a close eye on EWU on Thursday as manufacturing PMI is reported. In December, PMI was recorded at 58.4, above analyst expectations of 56.5.

3. Industrial Select Sector SPDR ETF (XLI, A)

Why XLI Will Be In Focus: This ETF is one of the most popular on the market, with over $8.8 billion in assets and an average daily volume just under 10 million. XLI seeks to replicate the performance of the U.S. industrial sector and will be in focus this week as the ISM Manufacturing PMI is reported on Thursday. In its previous recording, manufacturing PMI came in at 57.3, well above forecasts of 55.2 (a recording above 50 indicates industry expansion) [see also How To Pick The Right ETF Every Time].

Follow me on Twitter @DPylypczak.

Disclosure: No positions at time of writing.

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