3 ETFs To Watch This Week: XLI, XLY, GLD

by on January 28, 2013 | ETFs Mentioned:

Bullish momentum dominated Wall Street last week as major equity indexes rallied to multi-year highs. Better-than-expected earnings reports form DuPont (DD), Travelers (TRV), IBM (IBM) and Google (GOOG) helped bolster stocks, instilling a sense of earnings euphoria amongst investors. Tech heavy-hitter Apple (AAPL), however, disappointed investors as the company reported revenues that fell short of expectations and iPhone sales that missed quarterly projections. Meanwhile in economic news, Americans filing new applications for jobless benefits fell to 330,000, the lowest level in five years. This week, investors will once again see a slew of economic and earnings reports. Below, we outline three ETFs that should see a fair amount of activity during the week ahead [see also 7 Simple & Cheap ETF Model Portfolio]:

1. Industrial Select Sector SPDR ETF (XLI, A)

Why XLI Will Be In Focus: This fund is one of the most popular on the market, with over $4.5 billion in assets and an average daily volume just over nine million. XLI seeks to replicate the performance of the U.S. industrial sector and will be in focus this week as U.S. durable goods for the month of December are slated to come out on Monday. The number for core durable good orders, which excludes transportation items, is expected to come in at 0.8% compared to the previously reported 1.6% uptick. The number for all durable goods orders is estimated to increase 1.8%. Investors should also keep a close eye on this fund on Friday as U.S. ISM Manufacturing is reported [see also 17 ETFs For Day Traders].

2. Consumer Discretionary Select SPDR (XLY, A)

Why XLY Will Be In Focus: This ETF is by far the largest and most popular consumer discretionary fund on the market, with total assets topping $3.9 billion and an average daily trading volume of over 5.9 million. Its focus will come earlier in the week, as U.S. consumer confidence data and U.S. fourth quarter GDP are slated to be reported on Tuesday and Wednesday, respectively. Analysts are expecting a contraction in economic growth with GDP coming in at 1.3% compared to the previously recorded 3.1% figure. Consumer confidence is expected to come in slightly lower after a decrease in the previous report [Be sure to check out the real estate news, trends, tips and tricks over at Dividend.com].

3. SPDR Gold Trust (GLD, A-)

Why GLD Will Be In Focus: This physically-backed ETF offers exposure to the spot price of gold bullion. Gold prices have a history of making big swings whenever the Fed, or Chairman Bernanke, offers insights and economic commentary. As such, GLD could see a surge in trading volumes on Wednesday following the FOMC rate decision and Chairman Bernanke’s press conference. Many investors are expecting the central bank to continue with their bond-buying program in an effort to boost the economy [see also How To Pick The Right ETF Every Time].

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Disclosure: No positions at time of writing.