ETF Trading Report: MLP, Social Media ETF In Focus - ETF News And Commentary
May 18 2012 - 1:05PM
Zacks
All eyes were on the IPO of Facebook during Friday trading as
the company’s shares opened around $42.05 after a $38 pricing.
Still, despite the hype, investors failed to push the shares of the
social media giant higher on the day as the company finished
trading around the $39/share level.
Overall, the broad market wasn’t much better as all the major
benchmarks finished the day in the red. The Dow tumbled by 0.6%
while the S&P 500 finished lower by 0.7%. Meanwhile, the
tech-heavy Nasdaq saw the bulk of the selling as the index fell by
1.2% on the day (read Invest Like the 1% with These Three
ETFs).
Losses were pretty widespread among the sectors as health care,
big banks and some large tech names led on the downside. One of the
bigger slumps on the day came in Google—down 3.6%-- although Yahoo
did see some much needed strength on the session, adding about 3.7%
to its total.
Despite the market weakness, the dollar was lower on the day, as
the U.S. Dollar Index finished the session just above the key $81
mark. Additionally, there was minimal interest in more safe haven
buying as the ten year finished the day flat, sporting a yield of
1.71%.
With this backdrop, commodities were broadly mixed across the
board although crude continued to fall while natural gas added
another 4.7% to close out the week. Soft commodity trading was
decidedly positive, led by strength in many grains, while gold and
silver bounced back in Friday trading as well.
In ETF trading, the market was again active across many of the
industry’s top products as these funds once again saw trading that
was above observed average volume levels. This was especially
apparent in some of the U.S. sector funds, a couple emerging market
ETFs, and large cap style ETFs.
In particular, the Credit Suisse Cushing 30 MLP ETN
(MLPN) saw a huge spike in volume on the day. The product
usually trades around 93,000 shares but experienced a jump to just
over 600,000 to close out the week (read Oil Bull Market Is No
Place For MLP ETF Investors).
Still, the product slumped by 1.7% on the day although the
strong dividend of nearly 5.5% seems likely to cushion the blow for
many investors. Additionally, it is worth noting that the vast
majority of the volume in this note came in the final hour of the
session on one trade.
At this trade, which consisted of a 527,000 share block, the
product was at its low point for the day and then proceeded to move
higher by a few cents to close out the week. Clearly, a huge
investor had great timing—or had the ability to move the market—in
what was one of the final trades of the week for this increasingly
popular product.
Another ETF that was saw a great deal of trading volume on the
day was unsurprisingly the Global X Social Media Index ETF
(SOCL). The product usually sees about 32,000 shares
change hands in a normal session but, thanks to the FB halo effect,
experienced a surge to 410,000 shares in Friday trading (read
Social Media ETFs: Time to Buy?).
Obviously the debut of FB on the market played a huge role in
the increased interest in this fund during the day, especially
given how poorly many of the component securities reacted. In fact,
SOCL finished the day down close to 6.8%, within striking distance
of the low for the product.
(see more in the Zacks ETF Center)
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