Market Overview

A Look Ahead: This Week's ETFs to Watch

At the hands of a mixed batch of economic data last week that culminated in Friday's disappointing March jobs report, U.S. stocks suffered their worst weekly performance of 2013.

When all was said and done, the S&P 500 lost nearly one percent on the week and buyers stepped in Friday afternoon to prevent the week from finishing on an outright dreadful note.

In the week ahead, bulls looking to reignite this rally will have their hands full. There are plenty of speeches of by Federal Reserve members, including Chairman Ben Bernanke on Tuesday, data points and earnings reports to deal with.

That is right. Dow component Alcoa (NYSE: AA) kicks-off first-quarter earnings season Monday with is after-the-bell report. More significant names follow later in the week and those reports could have an impact on some of the following ETFs.

Financial Select Sector SPDR (NYSE: XLF)
Financials have had their day(s) in the sun as the Financial Select Sector SPDR was one of the better-performing high beta sector SPDRs in the first quarter. However, there are signs market momentum is waning and that could bode ill for this sector.

For example, Dow components and XLF holdings American Express (NYSE: AXP) and Bank of America (NYSE: BAC) lost 3.2 percent and 2.2 percent, respectively, last week.

Bank of America closed below the psychologically important $12 mark. XLF will be put to the test this Friday with earnings reports from J.P. Morgan Chase (NYSE: JPM) and Wells Fargo (NYSE: WFC). Aggressive traders may want to consider preparing for the worst with the Direxion Daily Financial Bear 3X Shares (NYSE: FAZ).

United States Natural Gas Fund (NYSE: UNG)
Natural gas futures have staged a stunning rally over the past six weeks, jumping to a 20-month high on Friday. The combination of declining reserves and colder-than-expected weather in some parts of the U.S. is helping the cause for natural gas bulls. Baker Hughes (NYSE: BHI) said last week that the number rigs exploring for gas fell by 14 to 375, the lowest level since 1999.

Those factors have UNG trading at its highest levels since November. Pivotal to the fund's near-term fortunes are its ability to break and hold above the $23 area. More conservative investors can play favorable natural gas trends with the First Trust ISE-Revere Natural Gas Index Fund (NYSE: FCG), which benefited from some bullish analyst comments on at least one of its holdings last week.

The more aggressive among us can look at the ProShares Ultra DJ-UBS Natural Gas (NYSE: BOIL) or the ProShares UltraShort DJ-UBS Natural Gas (NYSE: KOLD) in the event of a drop in natural gas futures.

ProShares UltraShort FTSE China 25 (NYSE: FXP)
Bad news for China bulls. The ProShares UltraShort FTSE China 25 gained 1.6 percent last Friday on better than triple its average daily volume to finish the week with a gain of nearly seven percent. The bearish China play is now flirting with a break above its 200-day moving average, a positive sign, and with CPI and PPI data looming Monday, FXP could keep running to the upside.

For more on ETFs, click here.

Posted-In: Earnings Long Ideas News Sector ETFs Broad U.S. Equity ETFs Short Ideas Specialty ETFs New ETFs Best of Benzinga

 

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