Emerging Global Shares has filed to launch a group of ETFs aimed squarely at the BRIC economies, according to Cinthia Murphy for Index Universe:

Emerging Global Shares INDXX India Infrastructure Index Fund

• Emerging Global Shares INDXX India Infrastructure Index Fund
• Emerging Global Shares INDXX China Infrastructure Index Fund
• Emerging Global Shares INDXX Brazil Infrastructure Index Fund
• Emerging Global Shares INDXX India Mid Cap Index Fund
• Emerging Global Shares INDXX China Mid Cap Index Fund
• Emerging Global Shares INDXX Brazil Mid Cap Index Fund
• Emerging Global Shares INDXX Growing Asia Large Cap Index Fund

Every single company within these funds will have no more than a 10% weighting. Net operating expenses are pegged at 0.85% for each fund. ALPS Advisors is the advisor for each fund, with Emerging Global Advisors LLC the subadvisor. (Read about the widening wealth shift between the United States and emerging markets).

Each fund will invest in securities, ADRs and GDRs of various companies to replicate their respective indexes. A fully replicating strategy will be used to assemble the funds, however, representative sampling may be used, if needed. (The ultimate guide to the BRIC ETFs). You can read the prospectus for the funds here.

The BRIC economies have been standouts this year as the world recovers from the global financial crisis, gaining about 110% since the market’s low. Russia has been one of the strongest, gaining 137% year-to-date. Brazil has gained 117%, China is up about 60% and India has added about 90%.

For more stories about BRIC ETFs, visit our BRIC category.

iShares has filed with the Securities and Exchange Commission (SEC) to launch the following ETFs:

• iShares Emerging Markets Financial Sector ETF
• iShares Emerging Markets Materials Sector Index Fund

A large inflow of assets into emerging markets signals that the timing could be right for the launch of these funds. Last month, about $1.76 billion in net inflows was seen by iShares MSCI Emerging Markets (NYSEArca: EEM). Likewise, Vanguard Emerging Markets (NYSEArca:VWO) saw $2.2 billion in net inflows in the same period.

There are three levels of concentration as far as emerging markets are concerned. The first level of concentration to consider is location. Broad emerging-markets funds such as EEM and VWO diversify assets over a handful of emerging markets, says Don Dion for The Street. It is necessary to make sure there is not a lot of cross-exposure taking place.

Secondly, beware of over-concentrated holdings. Ideally, the top holding should not make up more than 10% of holdings. If you are looking to purchase a fund with larger concentrations, make sure to monitor those holdings in particular. A large component can have a large impact on your portfolio. (Why stop losses matter).

Last, make sure to check out the sector components. If an over-allocation to financials or energy is selected, then the fund may become too volatile and diversification is not going to be as promising.

iShares’ filing is just the latest in growing interest in emerging markets. Both Global X (Check out their new ETFs) and Emerging Global Shares (See their latest offerings) have added to their line-up of emerging market offerings. PowerShares has the PowerShares Emerging Markets Infrastructure (NYSEArca: PXR), as well. It’s up 86.3% year-to-date.

Now that the many broader developing regions and countries have been targeted with ETFs, it seems providers are increasingly turning to sectors in these markets to give investors more options for their portfolios. As with any emerging market fund, follow the trend lines in order to protect yourself. (How to follow trends).

For more stories about new ETFs, visit our New ETF category.

Warren Buffett’s Berkshire Hathaway (NYSE: BRK-B) has agreed to buy Burlington Northern Santa Fe (NYSE: BNI) for $34 billion. Burlington Northern is the country’s second-largest raiload, and it’s also the biggest transporter of food products and coal, making it a harbinger of economic health, says Samantha Bomkamp for the Associated Press. iShares Dow Jones U.S. Transportation Average (NYSEArca: IYT) is up nearly 5% this morning on the news. Year-to-date, it’s up 3.3%.

Factory orders rose 0.9%, thanks to heavier demand in automobiles, heavy machinery and military aircraft. It’s the fifth increase in six months. The jump has economists optimistic of a recovery, but if consumer spending doesn’t pick up, manufacturing will suffer again. PowerShares Global Emerging Markets Infrastructure (NYSEArca: PXR) is down about 1.2% this morning; Caterpillar (NYSE: CAT) is 2.3%. (Yesterday’s report on industrial activity).

The European Union raised its 2010 growth forecast for the 27 nations to 0.7%, reports David Jolly for T he New York Times. By 2011, the EU anticipates growth of 1.5%. Despite the positive forecasts, the EU still feels that some factors will weigh on a recovery, including weak private demand and a struggling job market. (For more stories on Europe, visit our Europe category). iShares MSCI EMU (NYSEArca: EZU) is down nearly 2% this morning.

For full disclosure, Tom Lydon’s clients own shares of EZU.

Under the Recovery Act, counties are allocated large sums of low-interest bonds to give to private projects.  However, there are pros and cons to the Obama administration’s efforts to stimulate the economy.  Investment projects — especially for infrastructure and new technologies — produce limited, delayed results. Programs intended to keep people afloat seem to do the most to lift the economy, states Charles Euchner of The New York Times.

Additionally, the program gives priority to shovel-ready projects, but these take a long time to get going and positively influence the economy.  Infrastructure projects are beneficial because they not only put construction workers on the job, they also create a foundation for new waves of economic growth. Additionally, highways, airports and rail lines could increase the efficiency of local economies, and research and development could lead to innovation.  (Where infrastructure ETFs go from here).

Another problem with stimulus funding, experts say, is that dubious projects too often jump to the head of the line.  Projects with political backing win funding, regardless of merit, while more worthwhile projects languish for decades.  (The stimulus effort has its critics.)

For more stories on infrastructure, visit our infrastructure category.

Two ETFs that have been hindered by this lag is the SPDR/FTSE Macquarie Global Infrastructure Fund (NYSEArca: GII) up 2.7% year-to-date; and iShares S&P Global Infrastructure (NYSEArca: IGF), up 12.4% year-to-date.

Kevin Grewal contributed to this article.

The Obama Administration has announced that it’s investing $3.4 billion in order to fund this project. Through the plan, 100 private companies, utilities, cities and manufacturers will receive grants ranging from $400,000 to $200 million in order to build a smart energy grid, reports Lynn Sweet for The Chicago Sun-Times. So far, these awards are the largest Recovery Act awards ever made on one day. (Nine things that could affect alternative energy).

Analysis shows that by getting smart grid technology off the ground, it could reduce electricity use by at least 4% by 2030. This would result in savings of $20.4 billion for both businesses and consumers. (Does this mean alternative energy is not so alternative anymore?)

The Senate environment committee also released details of its climate change legislation, which includes the share of “emissions allowances,” which is revenue that comes from regulation of a cap-and-trade system – once it’s in place. The Senate has nearly tripled the share of allowances set aside by the House for transit, inter-city rail, and other efforts to trim transport-based emissions. Elana Schor for Streetsblog reports that the Senate measure would set aside more than 3% of allowances in the first two years of the cap-and-trade system for limiting pollution from the transportation sector.

For more stories about clean energy, visit our alternative energy category.

• First Trust NASDAQ Clean Edge Green Energy (Nasdaq: QCLN)
• iShares Dow Jones U.S. Utilities (NYSEArca: IDU)
• iShares S&P Global Infrastructure (NYSEArca: IGF)
• iShares S&P Global Clean Energy (NYSEArca: ICLN)
• PowerShares WilderHill Clean Energy (NYSEArca: PBW)
  
• PowerShares Global Clean Energy (NYSEArca: PBD)
• PowerShares Cleantech (NYSEArca: PZD)
• PowerShares Dynamic Utilities (NYSEArca: PUI)
• Utilities Select Sector (NYSEArca: XLU)
• Vanguard Utilities (NYSEArca: VPU)
• SPDR FTSE/Macquarie Global Infrastructure 100 (NYSEArca: GII)

Among the economic reports that left Wall Street with mixed feelings include

• In September, wholesale prices made a surprise drop thanks to lower energy costs. The Producer Price Index declined 0.6%, but economists were expecting a flat reading. In the year ending September, the index fell 4.8%, reports the Associated Press.
• Applications for hosing permits fell by the largest amount in five months in September. The applications help gauge future housing activity. Some suspect that the drop came amid concerns that Congress wouldn’t continue its tax credit for first-time homebuyers, reports Martin Crutsinger for the Associated Press. SPDR S&P Homebuilders (NYSEArca: XHB) is down about 1.2% this morning.

Earnings reports this morning were mostly better than expectations despite some losses:

• Caterpillar (NYSE: CAT) announced that its profit declined 53% in the third quarter. But the equipment maker is already looking ahead, saying that it expects its prospects to improve next year as the economy strengthens, reports the Associated Press. There are already signs of growing demand in Asia, and Caterpillar generates 70% of its sales overseas. PowerShares Global Emerging Markets Infrastructure (NYSEArca: PXR) is down about 1.5% this morning.

• Coca-Cola (NYSE: KO) saw its third-quarter profits move high, but sales took a hit from falling consumer purchases of carbonated beverages. The amount of soda shipped grew 2%, but fell 4% in North America.
• Drugmaker Pfizer (NYSE: PFE) reported a profit, thanks to cost-cutting that made up for declining sales. The company intends to keep cutting costs because it has the biggest drug industry deal of the year: a $68 billion acquisition of Wyeth. iShares Dow Jones U.S. Pharmaceuticals (NYSEArca: IHE) is down about 1% this morning.

Oil prices briefly topped $80 a barrel this morning, but retreated as soon as the dollar began to strengthen against the euro. It was the first time in a year that oil topped $80, reports the Associated Press.

Claymore Securities has filed to launch three new China-focused ETFs that will track different sectors in the emerging market. Luisa Beltran for Ignites reports that the three China ETFs will focus on consumer, technology and infrastructure, and will track an AlphaShares Index.

The funds are:

• Claymore/AlphaShares China Consumer ETF: Invests in China-based companies in the consumer discretionary and consumer staples sectors. The companies must have a market capitalization of $150 million or greater.
• Claymore/Alphashares China Infrastructure ETF: Invests in companies that derive a majority of their revenues from the development, management and/or ownership of infrastructure on mainland China or the Special Administrative Regions of China, such as Hong Kong and Macau. A market cap of $200 million must be met.
• Claymore/AlphaShares China Technology ETF: Invests in China-based companies in the information technology sector. A float-adjusted market cap of $200 million is a minimum requirement.

China remains confident in its ability to surmount the financial crisis, but the country’s leaders are still on guard against risks, report Susan Fenton and Joanne Chiu for Reuters. Inflation is one of the biggest risks concerning leaders right now. A jump in the money supply and increased lending have many believing that inflation is only a matter of time.

In other regards, China is on the right track. Industrial output rose 12.3% year-over-year in August, the fastest pace in a year. Power generation has also hit record highs, and government revenues have picked up, as well.

For more stories about new ETFs, visit our new ETF category.

Despite global infrastructure promises, deals aren’t materializing and the infrastructure industry is discovering that money is still hard to come by, writes Richard Barley for The Wall Street Journal. According to researcher Preqin, a record 94 infrastructure funds are out seeking capital.

Up until 2030, annual requirements for spending on electricity, roads, rail, telecommunications and water will be around 3.5% of global GDP. Developed countries will need to monetize infrastructure assets by privatization or by tolling, while infrastructure projects will likely cost even more in emerging markets.

Some countries have generated projects large enough to produce enough new jobs to syndicate guarantees from the state government while some corporate infrastructure operators gained funding through bonds and private debt placements. A few developing countries have the benefit of strong domestic growth, which would support financing projects internally.

Sen. Benjamin L. Cardin has asked the Senate to invest more in domestic infrastructure, and has proposed a Water Infrastructure Financing Act to give more than $35 billion in funding for both improving the water supply and basic infrastructure, reports the Associated Press.

• SPDR FTSE/Macquarie Global Infra 100 (NYSEArca: GII)

iShares S&P Global Infrastructure Index (NYSEArca: IGF)

Fore more information on infrastructure, visit our infrastructure category.

Max Chen contributed to this article.

Investors still have to decide on which industries are best positioned to perform well in the recovery, remarks Matt Krantz for USA Today. Possibly the worst thing any investor could do is jump in after sectors that have already gained, continually chasing performance.

After betting on financials and tech companies, investors are now looking for actual economic growth in the second half of the year, especially in consumer discretionary companies that make big-ticket items such as automobiles and appliances. Krantz notes, however, that investors are applying prudent techniques when picking out future winning sectors:

History. Certain sectors and certain companies do better at certain points of an economic cycle. If the past repeats itself, solid performance could come out of consumer discretionary stocks, along with materials and industrial companies. These “cyclical” sectors could gain as demand for goods picks up. Later, energy stocks could gain as companies expand to cover all the demand.

• Consumer Direct Select Sector SPDR (NYSEArca: XLY): up 30% year-to date
• iShares Dow Jones U.S. Basic Materials (NYSEArca: IYM): up 55% year-to-date
• SPDR Select Sector Fund- Basic Industries (NYSEArca: XLB): up 43% year-to-date
• Energy Select Sector Energy Fund (NYSEArca: XLE): up 17.7% year-to-date

Cycles. Growth in revenue is still down and may continue to be so in the third quarter, but some businesses could show early growth. The businesses that will perform will be the ones to stop cost cutting and start expanding. This is one of the reasons why financials may continue to benefit as demand for loans increases.

• SPDR Financial Select Sector (NYSEArca: XLF): up 23.3% year-to-date

Diamonds in the rough. Some small banks and brokers may stand out by enticing customers who have become estranged from large financial firms. Modernization of bridges and roads will lead to a boom in the infrastructure industry. Government investment into green tech will also likely help the alternative energy industry. As more companies use the internet to conduct business, business that build internet networking systems may also become in demand.

• iShares S&P Global Infrastructure (NYSEArca: IGF): up 13.8% year-to-date
• PowerShares Wilderhill Clean Energy Portfolio Fund (NYSEArca: PBW): up 28.9% year-to-date
• iShares Networking Fund (NYSEArca: IGN): up 61.7% year-to-date

Not so good. Sectors dependent on consumers may not see previous cash flows for awhile yet. Businesses such as retailers, restaurants and casinos may also continue to struggle.

Watch the trends. There’s no such thing as a “sure thing” in the markets, otherwise no one would ever lose anything. We can all guess which sectors will perform and which won’t, but reality could bear out differently. Watch the trend lines to spot the true opportunities, and have a stop loss in place, as well.

Max Chen contributed to this article.

There are talks about a profit bridge appearing as the stimulus dollars filter through the U.S. economy. Nick Hodge for Energy and Capital reports that $11 billion has been allocated to revamping the U.S. water supply, which could ultimately lead to a profit bridge.

The potential to profit from water comes from many areas, including:

• Drinking water infrastructure and the machines needed to make potable water
• Waste water infrastructure improvements and additions
• State-wide projects and funding for clean drinking water infrastructure projects

About $4 billion has already been delegated to water-related improvements in every state, with another $7 billion in the wings to go toward new water meters ad building more treatment plants.

ETFs are still the best way to access this sector, since trying to choose companies individually could be a time-consuming challenge for most investors.

• PowerShares Water Resources Fud (NYSEArca: PHO): up 18.2% year-to-date



• PowerShares Global Water (NYSEArca: PIO): up 32.5% year-to-date



• First Trust ISE Water Index Fund (NYSEArca: FIW): up 17.5% year-to-date



• Claymore S&P Global Water Index (NYSEArca: CGW): up 26% year-to-date

For more stories about water, visit our water category.