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ETF Outlook for October 15, 2013 (IHE, ITB, EWZ, SMH)

ETF Outlook for October 15, 2013 IHE, ITB, EWZ, SMH

Here are some notable ETFs worth taking a look at for Tuesday, October 15, 2013.

Market Vectors Semiconductor ETF (NYSE: SMH)

The ETF closed yesterday at a multi-year high as the technology stocks rebounded from early losses. While the breakout was significant, a close above $41.41 would put the ETF above the 2007 and at the best level in a decade.

The top holding, Intel (NASDAQ: INTC), which makes up 19 percent of the ETF reports earnings after the bell Tuesday and could be the catalyst for a new high. The ETF closed Monday at $40.75.

iShares U.S. Pharmaceuticals ETF (NYSE: IHE)

The drug stocks took a drubbing last week along with the biotech stocks as investors moved out of the health care sector. The good news is that the uptrend remained intact and IHE bounced off support at the $103 area before closing Monday at $106.01/share. Before the bell Tuesday morning the top holding, Johnson & Johnson (NYSE: JNJ), reports quarterly earnings. The stock makes up 11 percent of the allocation.

iShares Dow Jones U.S. Home Construction ETF (NYSE: ITB)

A report yesterday was released that showed housing affordability hit a 4-year low as mortgage rates continue to rise. The news hit the homebuilders and related stocks. The biggest sector ETF laggard was ITB with a loss of 0.8 percent. Since topping out in May the ETF has been lagging the market and is only up 2.7 percent in 2013.

The end of the government shutdown should instill more confidence into potential homebuyers and help ITB. The one risk is that mortgage rates will continue to increase in the coming years, which is almost a certainty.

iShares MSCI Brazil ETF (NYSE: EWZ)

One of the worst performing country ETFs in the world in 2013 is EWZ, with a loss of nearly 10 percent. But as of late the ETF has been perking up and rallied 1.4 percent yesterday to close at the best level in four months.

If EWZ can hold above the $50 resistance level it could be the boost the ETF needs to continue the uptrend back to the mid-$50’s. Could the upcoming World Cup and Olympics finally be a boost to the country?


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