ETFs: Broad, Deep And Down
Friday’s carnage made for the broadest
markdown in exchange-traded funds since TradingMarkets began tracking these
securities. Of the U.S.-focused tradable funds, only the Utilities HOLDR managed
to eke out a positive close.
The basket of utility stocks edged up
0.6% but gave up most of the day’s gains. Among its components, Dominion
Resources
(
D |
Quote |
Chart |
News |
PowerRating) added 2 11/16 to 53 11/6, Duke Energy
(
DUK |
Quote |
Chart |
News |
PowerRating) 1 3/8 to 81
13/16, Entergy
(
ETR |
Quote |
Chart |
News |
PowerRating) 1 9/16 to 35 7/8, PECO Energy
(
PE |
Quote |
Chart |
News |
PowerRating), PG&E
(
PCG |
Quote |
Chart |
News |
PowerRating)
1 to 56 5/8, 1 1/8 to 24 3/4. A number of the moves came on active trade,
indicating institutional accumulation.
The rest of the action in the ETFs was
to the downside. The Internet HOLDR
(
HHH |
Quote |
Chart |
News |
PowerRating) shed 5.0% to record its lowest
close since the basket of Internet stocks began trading on the American Stock
Exchange in September 1999. It was the day’s heaviest loss among the exchange-traded
funds.
The Dow Jones Internet Index iShares
(
IYV |
Quote |
Chart |
News |
PowerRating)
lost 4.7%, the Broadband HOLDR
(
BDH |
Quote |
Chart |
News |
PowerRating) 4.6%, the Internet Infrastructure HOLDR
(
IIH |
Quote |
Chart |
News |
PowerRating) 4.3%, the Biotech HOLDR
(
BBH |
Quote |
Chart |
News |
PowerRating) 4.1%, the Semiconductor HOLDR
(
SMH |
Quote |
Chart |
News |
PowerRating)
4.0%. Note the huge selling volume and range-bottom closes in the HOLDRs. That
suggests more downside to come.
For more on the trading action in the
Internets, check out my technical take on Razorfish
(
RAZF |
Quote |
Chart |
News |
PowerRating) and CMGI
(
CMGI |
Quote |
Chart |
News |
PowerRating)
in Trading
The News.
The Financial SPDR
(
XLF |
Quote |
Chart |
News |
PowerRating) declined
4.1% on explosive volume. The Banking HOLDR
(
RKH |
Quote |
Chart |
News |
PowerRating) fell 2.8%, the Dow Jones
Financial iShares
(
IYF |
Quote |
Chart |
News |
PowerRating) fell 3.9%. Brokerage stocks took a pasting on rumors
companies had incurred major junk bond losses.
As for the broad index shares, the
Diamonds
(
DIA |
Quote |
Chart |
News |
PowerRating), which track the Dow Jones industrial average, lost 1.2%; the
Qubes
(
QQQ |
Quote |
Chart |
News |
PowerRating), which track the Nasdaq 100, 3.3%; the Spyders
(
SPY |
Quote |
Chart |
News |
PowerRating), which
track the S&P 500, 3.1%.
If you’re new exchange-traded funds,
be sure to visit TradingMarkets’ Knowledge Center,
dedicated to explaining the basics of trading and active investing in ETFs and
mutual funds. Just click on the Funds tab
near the top of this page, then click on the Knowledge
Center tab.Â
You also will find lessons on trading
exchange-traded funds in the Stocks Education area of TradingMarkets.com. In
particular, check out my three-part series on trading ETFs, starting with
Average Crossovers. I also recommend newcomers read my tutorial,
HOLDRs: Unique Opportunity And Risk.