Argentina ETF Rallying Into The World Cup Final

ETF Outlook for Friday, July 11, 2014

After being down over 180 points, the Dow Jones Industrial Average was able to rally and close over 100 points off the intraday low.

Portugal was concerning, but investors realized the issues may be contained to the small European country. The share of the total global market cap for Portugal is only 0.13 percent and is not a major economic player. That being said, there could be contagion fears as the issues with Portugal could possibly spread to the peripheral euro countries such as Spain and Italy.

SPDR Financial ETF XLF

The first big financial stock reported earnings this morning. Well Fargo WFC reported EPS of $1.01, which was up 3 percent from last year. Revenues came in higher than expected, but the stock was down slightly after earnings were only inline with estimates.

The stock is the largest holding in XLF, making up 8.9 percent of the allocation. Both WFC and XLF rallied off the lows yesterday. Expect the early reaction this morning to be negative, however there could easily be some buying on weakness.

Global X FTSE Argentina 20 ETF ARGT

The country is trying to figure out how to make payments on billions of dollars of debt and at the same time concentrating on their soccer team that is vying for the World Cup on Sunday afternoon.

While the country is uber busy the ETF that tracks 20 large stocks based in Argentina is having a great run. ARGT closed at its best level in over two years yesterday and is now up 20 percent for the year. Who cares about debt problems when you have a good soccer team?

Market Vectors Gold Miners ETF GDX

The basket of gold stocks is set to open higher this morning, however the action yesterday was troubling. After a rally to the best level since early March as stocks plummeted, the ETF did a reversal that sent GDX to close out the day down 2 percent.

This type of action at/near a high is typically a bad omen for investors of the ETF and they must now realize there is a big red flag flying over the chart.