Market Overview

ETF Outlook for Wednesday, January 8, 2014 (ROBO, PBE, SMH, EUFN)

ETF Outlook for Wednesday, January 8, 2014 ROBO, PBE, SMH, EUFN

ETF Outlook for Wednesday, January 8, 2014.

ROBO-STOX Global Robotics & Automation ETF (NYSE: ROBO)

The young ETF, launched in October 2013, is starting to gain some attention and an increase in volume should follow in the months ahead. One of the ETFs holdings, iRobot (NASDAQ: IRBT), surged 7.1 percent Monday after it announced the launch of a new floor cleaning product.

The move did not have a big affect on ROBO yesterday, but the money flowing into automation and robotics stocks is picking up and with ROBO the only game in town it could be a big winner.

PowerShares Dynamic Biotech ETF (NYSE: PBE)

The ETF was one of the best performers yesterday with a gain of 4.7 percent. The ETF closed at a new all-time on above average volume. The move was odd because only one of the top holdings, Pharmacyclics (NASDAQ: PCYC), had a big move, rallying 19.9 percent.

See also: Bloomberg Markets Magazine Names Glenview Capital Top 2013 Hedge Fund

Apparently that was enough to help the ETF triple the return of its competitors (IBB and BBH). It will not be a surprise to see PBE underperform today after the breakout yesterday.

Market Vectors Semiconductor ETF (NYSE: SMH)

The tech ETF bounced off support yesterday with a gain of 0.3 percent after falling three consecutive sessions. The pullback was a nonevent considering the ETF closed out 2013 at the best level in a decade. When trading opens this morning SMH could be set to retest the highs after its number six holding reported positive news last night.

Micron (NYSE: MU) reported strong numbers that led the stock to immediately rally nearly 6 percent in after hours trading. The stock makes up 4.6 percent of SMH and could influence its peers trading activity today.

iShares MSCI Europe Financials ETF (NYSE: EUFN)

The basket of financial stocks based in Europe rose by 2.0 percent yesterday to the highest level in years. The rally was broad based with stocks from several countries in the region breaking out of trading ranges.

Within Europe, the most economically sensitive sector is the financials and as the economic backdrop strengthens it should not be a surprise to see the sector lead any rally. The ETF easily beat the performance of its U.S. counterpart, the SPDR Financial ETF (NYSE: XLF), which was up a penny yesterday.

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