ETFdb Weekly Watchlist: XRT, XLI, XHB Hinge On Retail, Philly Fed, and Housing Data

by on January 13, 2014 | ETFs Mentioned:

U.S. equities ended on a sour note last week as worse-than-expected labor data weighed heavily on the markets. Nonfarm Payrolls were reported at 74,000 for December, coming in far below analysts’ expectations of 197,000. The U.S. unemployment rate fell to 6.7% from 7%, largely as a result of people leaving the workforce. On the earnings front, Sears (SHLD) tumbled 13% after the retailer reported earnings that fell short of the Street’s expectations; meanwhile bellwether Alcoa (AA) also missed EPS estimates and posted a net loss. This week, investors will only see a handful of economic reports. Below, we outline three ETFs that should see a fair amount of activity during the week ahead [see The Fed Effect: How Monetary Policy Impacts Your ETFs].

1. SPDR S&P Retail ETF (XRT, A)

Why XRT Will Be In Focus: This ETF tracks an index that is comprised of the roughly 100 U.S.-listed, publicly-traded retail companies, a targeted sub-sector of the consumer discretionary space. Investors should keep a close eye on XRT on Tuesday as retail sales are reported, and on Friday as preliminary UoM consumer sentiment is released. Analysts expect retail sales to dip slightly from 0.7% to 0.2%; core retail sales are expected to remain at 0.4%. Preliminary consumer sentiment is expected to come in at 83.4 versus the previously recorded 82.5 [see Single Country ETFs: Everything Investors Need To Know].

2. Industrial Select Sector SPDR ETF (XLI, A)Retail Sales

Why XLI Will Be In Focus: This ETF is one of the most popular on the market, with over $9.6 billion in assets and an average daily volume just under 9 million. XLI seeks to replicate the performance of the U.S. industrial sector and will be in focus this week as the Philly Fed Manufacturing Index is reported on Thursday. Analysts expect the figure to come in significantly higher at 8.8 versus the previously recorded 7.0.

3. SPDR Homebuilders ETF (XHB, A+)

Why XHB Will Be In Focus: With over $2.0 billion in total assets under management, this ETF is by far the most popular option for investors looking to add exposure to the homebuilding industry. Its focus will come on Friday as building permits are reported. Analysts expect building permits to come in at 1.01M for December [see also How To Pick The Right ETF Every Time].

Follow me on Twitter @DPylypczak.

Disclosure: No positions at time of writing.