That should be enough to mean a decent day awaits PBJ if Green Mountain trades up 40% or more Thursday. News of the Coca-Cola/Green Mountain deal comes as staples stocks and ETFs have struggled to start 2014. PBJ along with its cap-weighted rivals are down about 7% year-to-date, confirming the laggard status of the staples sector in 2014.
On an anecdotal level, the Green Mountain news is important to PBJ because the ETF has a 13% weight to consumer discretionary stocks, over a third of which is allocated to Starbuck’s (NasdaqGM: SBUX). Shares of the world’s largest coffeehouse operator have plunged 10% this year as once downtrodden coffee futures have surged. [Brazil Drought Jolts Coffee ETNs]
PowerShares Dynamic Food & Beverage Portfolio
ETF Trends editorial team contributed to this post. Tom Lydon’s clients own shares of Coca-Cola and QQQ.