Mid-Day EFT Update: Stocks Mired in Red as Investors Reassess Economic Recovery

01:38 PM Eastern Standard Time, 12/17/2009 (MidnightTrader) — Active-volume exchange-traded funds at mid-day in today’s regular session:

SPDR S&P 500 (SPY): -1.20%

Select Financial Sector SPDRS (XLF): -1.40%

PowerShares QQQ (QQQQ): -1.22%

iShares MSCI Emerging Markets Index (EEM): -2.70%

iShares Russell 2000 Index (IWM): -1.58%

United States Natural Gas (UNG): +5.47%

Direxion Daily Financial Bear 3X Shares (FAZ): +3.76%

SPDR Gold Shares (GLD): -2.69%

Direxion Daily Small Cap Bear 3X Shares (TZA): +4.73%

UltraShort S&P500 ProShares (SDS): +2.23%

Winners and Losers

Major market ETFs, including the SPY, DIA, UYG and others, are down, with stocks mired in the red at mid-day and all three major indexes off just over 1% on renewed concerns about the economy.

The PowerShares QQQ (QQQQ), which tracks the technology-studded Nasdaq Composite, is down 1.22% ahead of earnings from several technology firms after the bell tonight, including RIMM, PALM and ORCL.

Technology Select Sector SPDR (XLK) is also off 1%, while Internet HOLDRs (HHH) iShares S&P North American Technology Semiconductor (IGW) and Semiconductor HOLDRs (SMH) are all off around 1.3%.

ProShares Ultra Technology ETF (ROM), iShares U.S. Technology (IYW), PowerShares Dynamic Software (PSJ) and iShares S&P North American Tech-Software (IGV) are seeing selling pressure, with all down between 1% and 2%. Wireless HOLDR (WMH) is of 1.57%.

Financial shares are lower, led by Citi’s (C) steep decline, after analysts panned its disappointing share price as part of its TARP-payback offering. American International Group (AIG) is lower after the New York Times reported it may need more federal help because of debt from involvement with mortgage guarantees.

Fannie Mae (FNM) and Freddie Mac (FRE) are also lower after the report said they and GMAC, all participants in the U.S. government’s rescue plan, may also need more aid. PNC Financial Services (PNC) is higher after JPMorgan Chase initiated coverage on the stock. Discover Financial Services (DFS) is lower after reporting rising losses on credit card loans dented Q4 earnings.

Commodities -

Gold futures are down at mid-day after the dollar rallied against other currencies to a multi-month high, reducing the appeal of the precious metal as an inflation hedge. Gold for February delivery, the most actively traded contract, is off $29.40 at $1106.80 at mid-day. Concern over Greece’s ability to finance its debt hurt the euro. SPDR Gold Shares (GLD) is down 2.1%. The Market Vectors Gold Miners fund (GDX) is down 2.6%. iShares Silver Trust (SLV), also high up in the volume ranks, is trading down 2%

Oil is trading down $0.81 to $71.85, after moving higher yesterday on a decline in domestic oil inventories. The United States Oil Fund (USO) is down 1.28%. United States Natural Gas (UNG) is rallying and among volume leaders at mid-day, after a new report showed a drop in inventories as frigid weather swept the midwest and the northeast.

ETF Power Play -

Homebuilder ETFs including iShares Dow Jones US Home Construction (ITB), PowerShares Dynamic Building & Construction (PKB), SPDR S&P Homebuilders (XHB) may lose some of Wednesday’s advance. The funds gained in yesterday’s session after housing starts and building permits data came in stronger than expected. But this morning, sector news may weigh on the funds.

Hovnanian Enterprises (HOV) is down 9% this morning. The company last evening reported a Q4 net loss of $3.21 vs a loss of $5.79 in the same period a year earlier, but deeper than the Thomson Reuters mean analyst estimtate was for a loss of $1.72.

Total revenues were $437.4 million for the three months ended October 31, 2009 compared with $721.4 million in the same quarter a year ago. The Street looked for $464.1 million.