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ETF Trading Report: Emerging Market, EFA ETFs In Focus

American stocks finished the week mixed as Microsoft and Schlumberger led on the upside while Apple, Bank of America, and Citigroup led the blue chips on the downside. Thanks to this, the Dow rose by fifty basis points while the S&P 500 added 0.1% and the Nasdaq slumped by 0.2%.

This mixed session for stocks came as the U.S. dollar index slumped once again, this time falling close to the $79 mark. However, bonds did see yields drop marginally as the 10 year fluctuated around the 2.0% mark but eventually did drop one basis point to the 1.96% level to close out the week.

Commodity markets did rise broadly, thanks in part to the slightly weaker dollar in Friday’s session. All the energy products finished in the green while soft commodities finished broadly ahead too. Seemingly the only big losers came in the corn, wheat, and sugar markets as these products all lost over 1.0% on the day (see Hard Times In Soft Commodity ETFs).

Despite it being Friday, ETF trading was relatively robust as investors saw above average volume in several big name products such as QQQ and a variety of sector funds. However, commodity ETF trading continued to be light as fewer than average shares changed hands in the gold, silver, and energy commodity spaces.

In particular, the SPDR S&P Emerging Middle East & Africa ETF (GAF) saw a heavy day of trading, far exceeding its usual light volume. The popular ETF that has about $100 million in AUM usually sees about 7,500 shares change hands in a day compared to the nearly 54,000 that moved hands in Friday’s session (also see Africa ETFs: Three Ways To Play) .

This jump is especially strange considering that the fund has such a heavy level of exposure to South Africa, a nation that already has its own ETF. Instead, it appears as though investors were looking for a way to bet on both this country and some of the North African nations that make their way into this fund ahead of the weekend. It also appears as though the bet was generally bullish as GAF rose by about 1.4% to close out the week.

Beyond GAF, another international ETF saw huge trading volumes on the day as the WisdomTree DEFA Equity Income Fund (DTH) saw a huge surge in volume. The high dividend paying ETF usually sees volume of about 25,800 shares in a normal session but saw a spike to nearly 325,000 to close out the week (read Ten Biggest U.S. Equity Market ETFs).

This jump was especially interesting given that other products with a heavy developed market focus didn’t see such a jump in trading activity. In fact, products like EFA which follows a similar region saw trading that came in below average for the day. Possibly, investors sought to play the region via a potentially more value oriented play with DTH ahead of what could be another volatile week in Europe, especially with the French election results coming out over the weekend.

(see more at the Zacks ETF Center)

Read the analyst report on GAF

Read the analyst report on DTH

Zacks Investment Research



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  • Read the analyst report on GAF, DTH