The situation continues to deteriorate in financial exchange traded funds with top bank holdings Bank of America (NYSE: BAC) and Citigroup (NYSE: C) feeling another sharp decline Wednesday.
Stock ETFs extended their losing streak as financials led the way lower and Visa (NYSE: V) shares fell after the U.S. Senate voted to limit debit card swipe fees.
Financial sector ETFs fell into negative territory Wednesday afternoon following reports the Senate voted to allow the Federal Reserve to curb fees banks receive from debit card transactions. [Visa, MasterCard Declines Hit Financial ETF After Senate Vote]
Exchange traded products that track sugar futures have bounced the past few weeks after peaking earlier this year. Soft commodities investments, such as a sugar-related exchange traded notes (ETNs), offer a great way to diversify an investor’s commodity portfolio. The iPath DJ-UBS Sugar ETN (NYSEArca: SGG) is up nearly 20% over the past month. The fund tries to reflect front-month futures contracts and rolls exposure to next month’s contracts before maturity. The iPath Pure Beta Sugar ETN (NYSEArca: SGAR) is up 10% in the last month, according to Morningstar. The fund offers greater protection on long-term investments by reducing the risks of roll costs that come from contango. [Sugar High ETNs Back in Sweet Spot?]
ETFs that invest in municipal bonds have regained their footing in 2011 after a nasty plunge late last year. Noted analyst Meredith Whitney touched off a firestorm last year when she told “60 Minutes” that she foresaw hundreds of billions of dollars of defaults in the muni bond market. She appeared on CNBC on Wednesday morning to defend that call. [Muni Bond ETFs Rise as Meredith Whitney Sticks to Her Guns]
Financial Select Sector SPDR Fund (NYSEArca: XLF)
ETFs that track gold bullion and miner stocks have been moving in different directions lately with the shares following equity markets lower. Market Vectors Gold Miners (NYSEArca: GDX) closed down approx 2.25% in afternoon trading Wednesday. It entered the session with an 11% year-to-date loss, according to Morningstar. SPDR Gold Shares (NYSEArca: GLD), which holds bullion, was fractionally lower Wednesday but has been steadily climbing since the sell-off in precious metals in early May. It is up about 8% so far in 2011. [Gold and Miner ETFs Part Ways]
Solar energy ETFs were sharply lower Wednesday as a disappointing forecast from LDK Solar (NYSE: LDK) and pricing worries clouded the volatile sector. Weakness in prices for solar products will eat into profit margins for SunPower Corp (NasdaqGS: SPWRA) and LDK Solar, the companies said, according to Reuters. LDK shares fell 7.5% Wednesday while another sector ETF component, Trina Solar (NYSE: TSL), dropped about 10%. [LDK, Trina Rain on Solar Energy ETFs]
Gregory A. Clay contributed to this article.