Predictably, industrial ETFs, funds where GE is often a marquee holding, are also enjoying GE’s plan to depart the financial services business.
The Industrial Select Sector SPDR (NYSEArca: XLI), the largest industrial sector ETF, is higher by 1.2% today. GE was 9.6% of XLI’s weight entering trading today, making the stock the ETF’s largest holding. With Friday’s gain, XLI is up 2.6%, indicating the ETF is trying to live up to its reputation as the best performer of the nine sector SPDRs in April. [Sector Ideas for April]
Since 1999, the first full year of trading for the sector SPDR ETFs, XLI has posted an average April gain of nearly 4%, according to CXO Advisory.
The technology, industrial and materials companies are among cyclical sectors that typically strengthen in a rising rate environment as investors turn away from safer assets and shift into riskier areas of the market. XLI is up half a percent this year.
Market Vectors Wide Moat ETF
