PowerShares QQQ (NasdaqGM: QQQ) jumped almost 2% on Tuesday as investors awaited quarterly earnings from Wall Street darling Apple (NasdaqGS: AAPL) after the closing bell.
The tech sector was leading the market following Monday’s pullback in U.S. stocks.
Some options traders have tapped tech ETFs to profit from strength in the sector as many bellwethers announce quarterly results this week, including Apple, IBM (NYSE: IBM), Intel (NasdaqGS: INTC) and Microsoft (NasdaqGS: MSFT). Options have been active in Technology Select Sector SPDR Fund (NYSEArca: XLK) the past couple sessions, involving mainly bullish call buying in August, Street One Financial said in a note Tuesday.
The Nasdaq-100 ETF, PowerShares QQQ, was up 6% year to date as of July 18, compared with a 4.9% gain for the S&P 500, according to investment researcher Morningstar. Apple is the largest stock holding at over 10% of assets.
Wall Street is looking quarterly earnings of $5.80 a share from Apple on revenue of about $25 billion. The company’s iPhone and iPad businesses are a profit machine.