This time of year, it’s all about earnings. A highly anticipated earnings season continued to heat up today, as UPS reported impressive results and Google announced first quarter net income of nearly $2 billion after the bell. Across the pond, Greece’s request for a meeting with the IMF caused some anxiety, as the first sovereign bailout in the euro zone’s history became increasingly likely. Elsewhere, strong manufacturing data gave stocks a boost while a new report showed conflicting opinions over inflation.
The ETFdb 60 Index, a benchmark measuring the performance of asset classes available through ETFs, finished the day down 0.32 points, despite the fact that winners outnumbered losers by nearly two-to-one.
Leading the way lower was the United States Natural Gas Fund (UNG), which slid 4.3% on the day. Most of the fund’s decline came immediately after the government’s weekly report on U.S. inventory levels. Analysts had expected stocks to rise by 81 bcf, but supplied actually rose by 87 bcf, sending natural gas prices sharply lower. UNG is now down nearly 30% on the year, as supply continues to surge and an uptick in demand from the manufacturing sector is yet to materialize (see How UNG Lost 20% In March).
UNG is often one of the most volatile non-leveraged ETFs on Thursdays, as the highly anticipated data release sheds light on recent demand (see Thursdays With UNG). Natural gas stocks are now more than 16% higher than the five year average level, a fact that has weighed heavily on UNG in recent weeks.
The iShares Dow Jones Transportation Average Index Fund (IYT) was among the biggest winners on Thursday, adding 1.7%. IYT’s jump came after UPS reported first quarter earnings of 71 cents per share, up from 52 center a share a year ago. UPS also raised its full year profit outlook to $3.05 to $3.30, up from $2.70 to $3.05 per share. UPS makes up about 8% of IYT, but the company’s bullish outlook on the economy lifted the entire sector. UPS stock added more than 5% on the day, while FedEx climbed 1.7%.
Disclosure: No positions at time of writing.