Storm, Economy Drag Down Energy ETFs

Market Wrap-Up

Crude oil was by far the largest influence on trading this week. Investors came back from the long Labor Day weekend to find that Hurricane Gustav had come and gone without doing severe damage to energy platforms anchored in the Gulf of Mexico. That led to a selloff on Monday that lasted all week. But Gustav wasn't to blame for the sustained selling. Indeed, it precipitated it Monday but a stack of poor economic data that came out later in the week also weighed heavily on the minds of Wall Street, especially unemployment data that showed payrolls shrinking. That data not only led to a selloff in commodities but also stocks across the board. In the end, a barrel of crude oil closed Friday at $106, down from the $116 level it started the week at. The Dow Jones Industrial Average dropped 324 points, posting deficits in three of the last four trading sessions. It closed at 11,221.

Winners

Financials did show some signs of life on Friday. After a morning downturn, bargain hunters picked up banks of every size. The SPDR KBW Bank ETF (KBE) gained 3.9% Friday. The iShares Dow Jones U.S. Regional Banks fund (IAT) increased 3.6%.

As for the week, well, it was a good one to be short the market, both here and abroad. The top 25 performing funds the last five trading sessions bet on the market falling. The ProShares UltraShort FTSE/Xinhua China 25 fund (FXP) jumped 17.9%. Investors had been betting on the announcement of a government stimulus plan in that country and when it didn't materialize stocks sold off.

Losers

It was pretty much a lousy week for any ETF that was energy-related.

The iShares Dow Jones U.S. Utilities Sector ETFIDU) dropped 1.7% on Friday, partly due to the idea two new storms brewing in the Atlantic could hit the East Coast over the next week and knock out wide swaths of power.

As for the week, Market Vectors Coal (KOL) dropped 14.9%. Solar ETFs, which tend to rise and fall with the price of crude, also pulled back. The Market Vectors Solar Energy fund (KWT) lost 17.1%. Even companies that get energy commodities out of the ground took it on the chin. The SPDR S&P Metals & Mining fund (XME) decreased 11.7% for the week.

The Weeks's Industry Headlines

Filing Status
Index Universe is reporting that Pimco, the legendary bond shop, has filed with the SEC to launch a series of stock and bond exchange-traded funds. No word on when the funds will start trading hands.

Invesco PowerShares announced it will probably begin trading its Global Biotech Portfolio ETF on Sept. 18. This fund will track a Nasdaq index of biotech firms, including Amgen (AMGN), Gilead Sciences (GILD), Genentech (DNA) and Celgene (CELG). The company is working on a series of launches for that date.

Launching Pad
Van Eck announced the release of its Market Vectors RVE Hard Assets Producers ETF. This fund tracks an index of 321 companies in 40 countries that are involved in the production of hard assets in the energy, agriculture, base metals, precious metals forest products, water and renewable energy sectors. Jim Rogers, the noted commodity investor, had a hand in the design of the index. It will charge an annual expense ratio of 0.65%.

Next Week's Notebook

Earnings & Conference Calls

Monday: Finisar, K12, Mitcham, Peerless Manufacturing
Tuesday: G-111 Apparel, Korn Ferry, Lakeland Industries, Pep Boys
Wednesday: Hooker Furniture, Stewart Enterprises
Thursday: Campbell Soup, Krispy Kreme, Piedmont Natural Gas

Economic Data

Monday
3:00p.m. July Consumer Credit

Tuesday
7:45a.m. ICSC Chain Store Sales
8:55a.m. Redbook Retail Sales
10:00a.m. July Wholesale Trade
10:00a.m. July Pending Home Sales

Thursday
8:30a.m. Initial Jobless Claims
8:30a.m. July Trade Balance
8:30a.m. August Import Prices
10:00a.m. DJ-BTMU Business Barometer

Friday
8:30a.m. August Retail Sales
8:30a.m. August Retail Sales, Ex-Autos
8:30a.m. August Producer Price Index
8:30a.m. August Producer Price Index, Ex-Food & Energy
10:00a.m. July Business Inventories
10:00a.m. Mid-Sep Reuters/U Michigan Sentiment Index

Quick Take

A look at how the industry's most popular ETFs did on Friday.