XLV Health Care Select Sector

Stocks had trouble staying above water during Wednesday’s session as Jamie Dimon’s testimony and weak retail sales weighed on stocks. Speculation about Greek elections didn’t help matters either, but the focus was clearly on the data as sales (less autos and gas) came in at a 0.1% decline when many were expecting a 0.4% increase in month-over-month terms.

Thanks to this, stocks were range bound for much of the day but finished in the red thanks to an afternoon swoon. The Dow lost 0.6% while the S&P 500 slumped by 0.7% and the Nasdaq led the losers, falling by about 0.9% on the day (read Guide to Small Cap Emerging Market ETFs).

In terms of sector performances, basic materials and services were in the red across the board, while telecom and big financials were in the green. Health care and utilities were more mixed, as were some of the staples names thanks to the retail sales.

The dollar was a tad weaker on the day though, as the euro gained half a cent against the U.S. currency, helping to push the dollar index lower by about 26 cents. Despite this, there was a strong appetite for T-bills, as the 10 year note lost six basis points in yield and finished the day at the 1.61% mark.

Commodity markets were surprisingly mixed despite the general risk off trade as gold and some softs managed to add a bit on the session. However, most energy products were in the red while a host of grains and industrial metals finished the day off as well (read Follow Goldman into Commodities with These Three ETFs).

In ETF trading, volume was modest across the board as investors seemingly wait until Greek elections and other data points before delving back into the markets. However, investors did continue to see above average trading levels in some commodity products, a few European ETFs, and the consumer discretionary sector once again.

Trading was particularly heavy in the case of the iShares MSCI Switzerland Index Fund (EWL). This product usually sees about a quarter million shares change hands on a regular basis but saw a spike to just over one million shares during Wednesday trading (read For Europe ETFs, It Is Hard To Beat Switzerland).

Likely this heavy interest came as the Swiss government bonds continue to trade in negative territory across much of the yield curve, suggesting to some that a peg could soon end between the franc and the euro. If this happens, it could definitely add to the volatility in EWL in the short-run and investors are likely positioning themselves in anticipation of this.

Furthermore, investors should note that the Swiss Franc ETF (FXF) also saw a great deal of volume as well during Wednesday’s session, suggesting that some investors are expecting a move in the coming days in the broad Swiss market.

Another ETF that had a big day of volume was the Healthcare Select Sector SPDR (XLV) which was in focus thanks to its top component Johnson & Johnson (JNJ). The product usually sees volume of about 5.7 million shares in a regular session but saw a spike to just over 15 million during Wednesday’s trading (read Could The Small Cap Healthcare ETF Be A Great Pick?).

This came as the fund’s top component, JNJ, added just under 2.2% as the government approved the firm’s plans to acquire medical device maker Synthes. This news helped to push JNJ to heavy volume on its own, well ahead of other stocks in the space. However, since JNJ is so massive, the heavy interest in this firm helped to boost interest in XLV as a proxy as well, adding to the interest for the popular SPDR during Wednesday trading.

(see more on ETFs at the Zacks ETF Center)

 
ISHARS-SWITZERL (EWL): ETF Research Reports
 
CRYSHS-SWISS FR (FXF): ETF Research Reports
 
JOHNSON & JOHNS (JNJ): Free Stock Analysis Report
 
SPDR-HLTH CR (XLV): ETF Research Reports
 
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