TradingMarkets 7 ETFs You Need to Know for Friday

Buyers remained on the defensive on Thursday – but defensive stocks were among those being avoided, as well. Sellers were also prominent among financial and BRIC country ETFs.

Here are 7 ETFs You Need to Know for Friday.

Money flowed from safety stocks like those in the consumer staples sector on Thursday. Much of this exodus stemmed from the news that Wal-Mart
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was lowering its earnings outlook. Avon Products
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also dragged the sector lower while Supervalu
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, a stock we pointed out in TradingMarkets 7 Stocks You Need to Know days ago, continued to outperform in the group. Represented by the exchange-traded fund, XLP
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, the Consumer Staples SPDRS moved lower for the third trading session in a row.

Financial stocks were also under selling pressure on Thursday, led lower by selling in JP Morgan
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and Chicago Mercantile Group
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. A bright spot in the sector, which can be traded by ETF traders through the Financial Select Sector SPDRS, XLF
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, was Morgan Stanley
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, which was trading higher after pulling back on Wednesday.

Traders and investors can hedge positions in financial stocks through inverse ETFs like the ProShares UltraShort Financial ETF, SKF
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, which tracks the inverse of the Dow Jones U.S. Financial Index on a two-to-one leveraged basis. Another inverse leveraged option for traders focused on the financial sector are the Rydex Inverse 2X S&P Select Sector Financials ETF, RFN
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.

Soaring deeper into overbought territory below the 200-day moving average were the Rydex CurrencyShares British Pound Sterling Trust ETF, FXB
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. The fund is headed toward potential resistance in the form of the December and November highs.

Exchange-traded funds from two of the three so-called BRIC countries – Brazil and China – continued lower on Thursday, becoming increasingly oversold below the 200-day moving average. Those ETFs are the iShares MSCI Brazil Index ETF, EWZ
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and the iShares FTSE/Xinhua 25 Index ETF, FXI
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.

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