ETFs are flat on Thursday as data pointing to slowing manufacturing growth in China was offset by but a better-than-expected data on U.S. jobless claims, manufacturing, and home sales.
- The number of U.S. workers filing new applications for jobless benefits fell below the key 400,000 level in the most recent weekly data, in a signal that the labor market is continuing to mend. The decline sent claims to the lowest level since July of 2008, the Labor Department reported Thursday. PowerShares Dynamic Retail (NYSEArca: PMR) is reacting well to the reports, up 0.6% in early trade.
- The Chicago PMI climbed to 68.6 in December, compared to November’s reading of 62.5. Economists polled by MarketWatch had expected a reading of 61.0. Any reading above 50 indicates expanding activity. The national Institute for Supply Management’s manufacturing poll is due for release on Monday. The iShares Dow Jones Basic Materials (NYSEArca: IYM) is up nearly 0.5% in the wake of the report.
- Pending home sales rose 3.5% in November, according to an index released Thursday. The National Association of Realtors said its pending home sales index rose to 92.2 from a downwardly revised 89.1 in October. The index is still 5% below November 2009 levels. The data reflects contracts and not closings, which normally occur with a lag time of one or two months. The index is based on a large national sample, typically representing about 20% of transactions for existing-home sales. If you’re bullish on housing, you can play improving real estate trend with the ProShares Ultra Real Estate ETF (NYSEArca: URE), which is flat so far this morning.
- The Swiss franc strengthened on Thursday to new highs against the U.S. dollar, euro and the British pound, as investors turned to the safe-haven currency amid weakness in other industrialized economies. The strengthening Swiss currency has become a bane for exporters there. With interest rates already at a record low, the central bank has little leeway to temper the franc’s rise. Rydex CurrencyShares Swiss Franc Trust (NYSEArca: FXF) is up nearly 1% this morning.
For full disclosure, Tom Lydon’s clients own IYM. Read the disclaimer; Tom Lydon is a board member of Rydex|SGI.
Gregory A. Clay contributed to this article.
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