Daily ETF Roundup: XHB Pops On Optimism, VXX Continues To Sink

by on June 8, 2012 | ETFs Mentioned:

Euphoria returned to the markets today as President Obama’s press conference restored some confidence in the domestic economic recovery; however, the President’s remark that the private sector “is doing fine”  did draw a lot of criticism from his opposition. On the home front, major equity benchmarks finished off the week in green territory, regaining lots of lost ground from the most recent correction. The Nasdaq took the lead higher, setting up 0.97% on the day, the Dow Jones Industrial Average on the other hand barely lagged behind, inching higher by 0.75% as the closing bell rang [see also 101 ETF Lessons Every Financial Advisor Should Learn].

The latest U.S. trade deficit data came in better-than-expected; the figure came in at a negative $50.1 billion, which is a modest improvement from the previous reading of negative $52.6 billion. Wholesale inventories also improved on the home front, growing by 0.6% in April and trumping last month’s figure of 0.3%. In international news, Canada’s unemployment rate came in unchanged at 7.3%, although the nation did add 7.7k jobs versus the expected 5k [see ETF Technical Trading FAQ].

The State Street SPDR Homebuilders ETF (XHB) was one of the best performers, gaining 2.0% on the day. XHB opened below yesterday’s closing price only to charge higher throughout the day; buying pressures bolstered this ETF to close near its highs for the day just shy of $20.40 a share [see also 2012 ETFdb Portfolio].

The Barclays iPath S&P 500 VIX Short-Term Futures ETN (VXX) was one of the worst performers, shedding 5.45% on the day. Uncertainty seemingly evaporated from the market today as investors rejoiced over encouraging data on the home front coupled with renewed hopes that Spain would recieve necessary funding over the weekend. The Volatility Index has come down considerably this week, although uncertainty levels will remain elevated until the VIX finds its way back below the 20 level [see The Compelling (And Simple) Case For Low Volatility ETFs].

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Disclosure: No positions at time of writing.