Four ETFs to Watch This Week: ITB, XES, XLY, XRT
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As 2011 begins to wind down there will be a number of opportunities for traders seize. This week in particular will be intriguing with several key economic reports due to be released. The results have the potential to make waves in multiple sectors of the market. Here are four ETFs for traders to watch this week ahead of the data.
Home Sweet Home
On Wednesday, the Department of Energy will release its crude oil inventories report. The result will have short term implications for oil ETFs such as the SPDR S&P Oil & Gas Equipment & Services ETF (NYSE: XES). Last week the report showed a drop in inventories as refineries have amped up their output. Shares of XES have fallen 12.6% on the year.
The iShares Dow Jones U.S. Home Construction Fund (NYSE: ITB) is set to move in the coming days. On Thursday, the Department of Commerce will release its construction spending results for October on Thursday. So far this year spending on residential construction is down 3.4% versus the first nine months of 2010.
ITB has significantly underperformed the market in 2011. It has declined 21.1% compared to a 7.9% dip from the S&P 500. Expectations are that overall construction spending in October will experience a slight uptick. At this point, it will not take much to move the needle for ITB in the right direction.
Spotlight on the Consumer
On Thursday, the results of auto and truck sales from November will begin to make headlines. During October, light vehicle sales in the U.S. jumped 7.5% to 1.02 million units. The best October since 2007 was fueled by healthy sales of sports utility vehicles and trucks.
The Consumer Discretionary Select Sector SPDR Fund (NYSE: XLY) is one way for traders to make a macro bet on these results. The fund includes Ford and a couple of other automotive related companies such as AutoZone, AutoNation and Goodyear. XLY is down 2.9% in 2011.
One other ETF to keep an eye on in the coming days and weeks is the SPDR S&P Retail ETF (NYSE: XRT). The fund may serve as a vehicle for traders looking to place bets on the outcome of Black Friday, Cyber Monday and the holiday shopping season. Year-to-date, XRT is up 0.3%.
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