ETF Outlook For Tuesday, January 14, 2014 (GDX, PBS, SPY, EGPT) «
The market suffered its worst day of 2014 yesterday with SPY falling by 1.34 percent to the lowest level since the December 20. The one-day drop was the largest since late September for the ETF. The selloff came on heavy volume as all 10 S&P sectors were lower.
A combination of a negative call from Goldman Sachs regarding equity valuations and comments from a Fed president led to investors taking profits.
Technically the attention turns to the 50-day moving average, which has been a support zone several times over the last year. The indicator is currently at $180.27 and the ETF closed today at $181.68. The other level of support to watch is at the $177 area.
PowerShares Dynamic Media ETF /quotes/zigman/383205/delayed/quotes/nls/pbs PBS -0.77%
Two big names in the cable industry were moving higher after the bell yesterday when Charter Communications /quotes/zigman/121019/delayed/quotes/nls/chtr CHTR +0.34% made a buyout offer for Time Warner Cable /quotes/zigman/528868/delayed/quotes/nls/twc TWC -1.26% at $132.50/share.
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The news was not a major surprise and either was the response from TWC rejecting the deal immediately. Both stocks have been moving sideways recently as PBS has been pulling back with the overall market from an all-time high. The possibility of consolidation in the cable sector is extremely high and with PBS heavily concentrated in the sector it will be a mover on any news.
Market Vectors Gold Miners ETF /quotes/zigman/420125/delayed/quotes/nls/gdx GDX -0.26%
One of the only sectors to close in positive territory yesterday was the niche ETF that focuses on gold mining stocks. GDX finished higher by 2.9 percent and closed at the best level since November.
The close at $22.65 was the first time the ETF closed above the 50-day moving average since October when the ETF achieved the feat before continuing the downtrend to a multi-year low. If the ETF can continue to close above $22 for a few days it will signify a breakout that must be watched and respected.
Market Vectors Egypt ETF /quotes/zigman/18927998/delayed/quotes/nls/egpt EGPT +0.19%
The Egyptian EGX 30 Index, which tracks the 30 largest and most liquid stocks in Egypt, closed up two percent yesterday to the best level in just under three years. Considering what the country has been through and is still dealing with it is a surprise to see money flowing into the country. On the flip side, the country does have natural resources and is the third largest economy in Africa.
EGPT closed yesterday higher by 2.2 percent, its best level in 14 months. The breakout yesterday was on heavy volume and was a bullish longer-term signal.