Some of the world’s key index ETF’s suffered minor declines early in the week as interested parties wait on Q1 figures from a multitude of energy titans.
Arguably the biggest global business giant, Apple, will release data 24 hours later.
Looking at the S&P 500, most of the decreases came as a result of energy stocks. A month long oil rally has seen floor traders cut and run. WTI crude futures leveled out 2.4 percent at $42.75 a barrel.
SPDR dropped just over a single percentage point but is up over 10 percent so far this year. It also reigned in its six month average in April, something we haven’t seen for 2 years. For the year to date, the energy industry is setting the bar for the S&P 500. Nevertheless, SPDR is trading almost a quarter below its yearly high.
The sector that most investors are concentrated on is energy, with earning reports expected this week from titans in the industry such as Chevron, ConocoPhillips, BP and ExxonMobil.
As a result of Halliburton’s recent merger maneuvers with Baker Hughes, the world’s largest oil services provider delayed its Q1 data report for 2 weeks.
Halliburton’s closest competitor, Schlumberger, released its reports last week and suffered a drop in its stock as a result. A statement by the company, who operate in 85 countries, warned that the situation may not improve this year.
The only factor keeping oil stocks trading at a high level, it seems, is the upturn in commodity prices. What everyone associated with the crude business is hoping for, to end the out of control oil glut, is an output freeze. However, this is unlikely to occur in 2016.
Utility stocks, historically a very defensive bet, led S&P 500 sectors this week; with consumer staples and real estate also up at the top.
One ETF that raised a few eyebrows was gold, which rallied with a 0.3 percent jump for SPDR Gold Shares. Analysts at Pana Mining Holding Group say that the commodity ETF is “not likely” to breakout this month. It also attempted to break last month but remained range-bound.
The analyst said that after a very decent first quarter rally, gold has moved into a considerable range of neutrality this month as the market settles.
“There are other lively factors at the moment which might take away some of the limelight from gold such as the U.S. Federal Reserve Open Market Committee (FOMC) meeting and the G-7 summit in Japan, and neither of these will help gold breakout anytime soon, it’s not likely” he said.
