Daily ETF Roundup: XLF Leads The Rally, GLD Plunges

by on March 13, 2012 | ETFs Mentioned:

The bulls ran will on Wall Street as fairly upbeat commentary from the Fed coupled with better-than-expected retail sales data paved the way higher for stocks across the board. The Nasdaq led the way higher, gaining 1.88% on the day, while the Dow Jones Industrial Average lagged behind, although not by much, inching higher by 1.68%. Crude oil prices took traders for a wild ride amidst the stock market euphoria; prices hit a low near $105.80 a barrel barrel in early morning trading, only to climb as high as $107.35 a barrel around noon [see also Why You Should Sell UNG, Buy FCG].

Positive economic data on the home front rightfully set the tone for a broad-based rally. The NFIB Index, which measures small business optimism, came in at 94.3, inching past the previous reading of 93.9. Retail data further bolstered investors’ confidence; sales in February grew by 1.1%, posting a modest increase from last month’s reading of 0.4%. In international news, German economic sentiment came in better-than-expected as well. The German ZEW Survey came in at 22.3, posting a big improvement from last month’s reading of 5.4.

The State Street Financial Select Sector SPDR (XLF) was one of the strongest performers, gaining 3.84% on the day, bolstered by encouraging economic data coupled with fairly upbeat commentary from the Fed [see also Financials Free ETFdb Portfolio]. The FOMC kept interest rates unchanged and went onto tweak their outlook from the previous meeting. Ian Shepherdson, chief U.S. economist at High Frequency Economics, wrote “In short, the FOMC is clearly shifting its stance away from blanket gloom to something more realistic, but they have a long way to go”.

The SPDR Gold Trust (GLD) was one of the weakest performers, shedding 1.68% on the day. Upbeat commentary from the Fed tipped gold prices south in the second half of the trading session; futures prices for the precious yellow metal failed to hold support at the $1,700 an ounce level, sinking as low as $1,662 an ounce before the closing bell rang. Despite today’s sell-off, GLD is still up 6% year-to-date [see GLD-Free Gold Bug ETFdb Portfolio].

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Disclosure: No positions at time of writing.