EWP iShares MSCI Spain ETF

U.S. equities rose again in Thursday trading as more solid earnings reports carried the day for stocks. The DJIA led the way for the major indexes as the benchmark added 0.9% compared to gains of about 0.7% for the Nasdaq and S&P 500.

Meanwhile in currency trading, the U.S. dollar index slid below the $79 mark as the European currencies continued to strengthen against the greenback on Thursday. However, despite the weaker dollar and stronger equity markets, we still saw yields fall on U.S. government bonds as the 10 year slumped to a yield of 1.95% in the session (also read Southeast Asia ETF Investing 101).

Commodity markets were generally positive across the board as risk taking was again popular among day traders. With the exception of natural gas, all the major energy commodities rose on the day while similar gains were had in the precious and base metals as well. Beyond this, investors did see some weakness in a few of the softs and grains as coffee fell by half a percent, sugar saw a 2.5% loss, and rice tumbled by 2% in today’s trading.

In ETF trading, light volume was the name of the game in many of the most widely held products as investors once again focused on individual securities due to earnings season. With that being said, we still saw some outsized volumes in a few commodity products, some European ETFs, and a couple of the more specialized funds on the market.

In particular, investors saw outsized trading volume in the iShares MSCI Spain ETF (EWP) yet again. This fund, which usually sees volume of about 200,000 shares a day, saw a spike to about 885,000 shares in Thursday’s session (see Three Unlucky Equity ETFs).

A huge reason for this unusual volume was the earnings release of Banco Santander (STD) which saw a 51% surge in provisions for bad loans. Thanks to this, the firm saw earnings drop about 24% once again causing investors to worry over the health of the Spanish economy.

Investors should also note that the stock makes up about 18.4% of EWP, one of the key reasons for the fund’s huge volume spike and its modest slide in price, down 0.5% on the day.

Another ETF that saw volume spike in Thursday trading was the United States Natural Gas Fund (UNG), the most popular way to play natural gas in ETF form. The product usually sees robust volume of 6.2 million shares a day but saw nearly 22.5 million shares change hands in Thursday trading.

Many investors who are familiar with natural gas shouldn’t be too surprised by this bump in interest as the weekly storage report for the fuel comes out every Thursday. Generally, this is a market moving event and today’s report was no different as supplies rose by 47bcf in the most recent period (read Have The Natural Gas ETFs Finally Bottomed Out?).

This pushed UNG down over 2.25% on the news while causing a spike in volume well above normal levels. Total natural gas stocks are now at 2,580 bcf which is well above historical averages. In fact, the level is nearly 52% higher than the year ago period, suggesting more bearishness may be at hand in this corner of the commodity market.

(See more on ETF Trading in the Zacks ETF Center)

 
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