ETF Trading Report: Global, Oil Service ETFs In Focus - ETF News And Commentary

Zacks Investment Research
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Posted: May 10, 2012 5:11 PM
ETF Trading Report: Global, Oil Service ETFs In Focus - ETF News And Commentary

Equity markets were mixed in Thursday’s trading session as gains in the consumer and health care space offset weakness in the broad tech sector. Due to this, the Dow rose by about 0.2%, the S&P 500 added 0.3%, while the Nasdaq was lower by one point thanks to a weak earnings report from Cisco which saw the company slide by 10% on the day.

In currency trading, the dollar was also flat, as the euro and pound gained against the greenback while the dollar did strengthen marginally against the yen and the Aussie dollar. Meanwhile, in bond trading, short-term debt remained flat although investors did moderate increases along the long-end of the curve. In this segment, both 10-year and 30-year notes added three basis points of yield in Thursday trading.

Commodity markets were, unsurprisingly, flat as well during Thursday’s session, although a few products did see volatile days. Most oil and livestock products slumped while metals, natural gas, and some softs added on the session. Seemingly, the biggest movers came in the corn and cotton markets as these two commodities fell by, respectively, 3.3% and 4.7% on the day (see the Comprehensive Guide To Utility ETF Investing).

In the ETF trading world, activity returned to normal in many products as interest died down after European events temporarily faded from the headlines. Volume came in below average in the major equity and commodity products, although there was still some high levels of interest in bond, international, and sector markets in Thursday’s session.

In particular, investors saw a big day in the iShares Dow Jones US Oil & Gas Exploration & Production ETF (IEO) during Thursday trading. The product usually sees volume of about 181,000 shares in a session but saw a spike to 544,000 during today’s trading (see Play An Oil Bull With These Three Emerging Market ETFs).

The vast majority of the trading took place during the first hour of the session for this large cap focused product while the volume slowed to a trickle in the afternoon segment of Thursday. Nevertheless, the product was flat on another lukewarm day in the oil markets as IEO added just 0.4% for the session.

Additionally, the SPDR MSCI ACWI ex-US ETF (CWI) was a big mover as global ETF investing remained in the spotlight. This product usually sees volume of about 187,000 shares a day but today saw a spike to 1.26 million shares (read Five Great Global ETFs For Complete Equity Exposure).

Nearly all of that volume came at 1:49pm as a block of 1.21 million shares hit the wires and temporarily moved shares of CWI higher by a few cents. The product soon fell back below this purchase level, but was still higher than what investors saw in Wednesday’s session.

Although the volume was certainly unusual, investors should note that many other global ETFs saw outsized days as well. Most products tracking the EAFE or broad all world ex-US segments saw above average trading levels, but all paled in comparison to the impressive volume block that was traded in CWI during the day.

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