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ETF Trading Report: Clean Energy, Spain ETF In Focus

Eric Dutram

American markets saw weakness in Wednesday trading as tech giants IBM and Intel had disappointing reports. The results were especially gloomy for IBM as the giant slid by 3.5% during the day and another 0.2% in after-hours to finish the day below the $200/share mark. Thanks to this, the Dow led the major indexes lower while the Nasdaq and the S&P 500 both finished the day down by about 0.4% as well.

Currency trading was also flat on the day as the dollar did manage to add marginally against many of the world’s currencies, but especially the yen. However, this was cancelled out by a strong move in the pound as the British currency added nearly a full cent against its American rival. Bond trading was also mixed on the session, although prices did rise as yields fell below the 2.0% level for Ten year bonds.

Meanwhile, commodities finished the day broadly lower as the headline products of gold and oil finished in the red and were followed by many of their lesser traded resources in their respective spaces. Losses were especially bad in corn and sugar as both of these commodities slumped by over 2% in Wednesday trading (see A Primer On ETF Investing).

In ETF trading, the slew of earnings reports kept investors focused on individual securities instead of their broad based counterparts. Nevertheless, investors did see high volumes in some global funds, Europe ETFs, and a few financial products.

In particular, the iShares MSCI Spain ETF (EWP) saw impressive volumes of nearly 660,000 shares, well above the daily average of 173,000. This huge spike came for a few reasons, as Spain and its economy continue to dominate the news (read Three Unlucky Equity ETFs).

First, concern is still growing over yields on Spanish debt and how the country will recover from a weak economy. More importantly, the nationalization of YPF by Argentina has roiled Spanish markets, especially considering the company’s former parent—Respol (REPYY)—is the fifth biggest holding in EWP. Thanks to this, Spain saw outsized trading and investors saw the price for EWP plunge by nearly 3.5% on the session.

Beyond European ETF woes, investors also saw outsized trading in the Market Vectors Global Alternative Energy ETF (GEX). This product saw volumes of nearly 186,000 shares in Wednesday trading, crushing the daily average of 31,700 (read Thrive With These Two Clean Energy ETFs).

This alternative energy ETF probably saw an increase in volume thanks to some earnings reports in a few of its top holdings. In particular, Cree, Inc. (CREE) stands out due to its 6.1% loss in today’s session. This leader’s weakness undoubtedly transferred over into some of the smaller players in the space, causing GEX to lose about 1.7% on the day but also to see volume well above average levels.

(See more on ETF Trading in the Zacks ETF Center)

Read the analyst report on EWP

Read the analyst report on REP

Read the analyst report on REPYY

Read the analyst report on GEX

Read the analyst report on CREE

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