ETF Outlook for Friday, January 10, 2014 (IYT, RSX, EWZ, XBI)

ETF Outlook for Friday, January 10, 2014

iShares Dow Jones Transportation Average ETF IYT

A major outperformer yesterday was the transportation stock, led by a big rally in the airlines. The sector was led by a 6.8 percent gain in United Continental Holdings UAL and a 6.6 percent gain for American Airlines Group AAL.

The rally in the airlines was enough to push IYT up 1.1 percent and to the highest level ever. This is as the overall market struggled to get out of its own way yesterday.

Market Vectors Russia ETF RSX

The single-country ETF closed yesterday at the lowest price in four months as money continued to come out of the emerging markets. Even though RSX appears to be set for lower prices in the near future there is one bright spot for the ETF. It’s ninth largest holding, which makes up 4.5 percent of the allocation was named Morgan Stanley’s top 2014 media pick.

See also: Sector ETFs Breaking Out (IBB, IHE, XLV, IAT, SKYY)

The company is the country’s social media lead, Yandex YNDX. With too much concentration on sectors other than technology, RSX will likely continue to underperform and should be avoided.

iShares MSCI Brazil ETF EWZ

Another 1.25 percent fall yesterday for EWZ has the ETF down 6 percent for the year. Both major ratings agencies (Moody’s and Standard & Poor’s) suggested another downgrade might be coming for the country in the future.

The ETF is quickly approaching support at the $41 area, which is also a five-year low. EWZ closed yesterday at $41.98 and if the trend continues it could be breach support by early next week. A close below $41 would trigger yet another breakdown for the once high-flying ETF.

SPDR S&P Biotech ETF XBI

The second biotech ETF this week to go rogue and outperform its peers by a large amount on a daily basis is XBI. The ETF closed higher by 7.5 percent yesterday on big volume to a new all-time high . What makes this move even more exciting is that the ETF’s three peers all gained about 1.2 percent on the session.

And with XBI being the most diverse of the group with the top holding only making up two percent it raises some questions. It will be important to watch the action in XBI today and more specifically compared to the other biotech ETFs.