US markets trade positively for second straight session
US markets were trading on a higher note on April 19, 2016, as crude prices were seen rising by more than 3% even as the Doha meeting aimed at capping production levels failed. The strike in Kuwait has cut crude production, leading to higher oil prices. Volatility is expected to continue in the near term in oil stocks as fundamental growth hasn’t yet stabilized while long-term prospects are expected to recover. Other commodities including precious metals and essential metals were also trading on a higher note, taking cues from the increase in oil prices.
As of 3:00 PM EST on April 18, the S&P 500 VIX Index had risen by 0.22% while the S&P 500 Futures Index and the Dow Jones Industrial Average increased by 0.15%. In contrast, the NASDAQ Futures fell by 0.54%.
Housing starts drop and building permits hit one-year low
There was a sharp drop in building permits in the US on a monthly basis in March. Permits fell by 7.7% against a fall of 2.2% in the previous month. Permit levels hit a one-year low, suggesting a slowdown in the housing market after a sluggish first quarter. Housing starts fell by 8.8% on a monthly basis in March, dropping to their lowest level since October last year.
Impact on ETFs across sector SPDR indexes
The crude oil and oil exploration sectors traded positively following the rise in crude prices. The SPDR S&P Metals & Mining ETF (XME) was the outperformer of the day on April 19, rising 3.9% as of 3:00 PM EST. The SPDR S&P Oil & Gas Exploration & Production ETF (XOP) rose 2.4% while the Energy Select Sector SPDR ETF (XLE) rose 1.8% on the day.
Among the major sector-specific SPDRs trading negatively, the SPDR S&P Biotech ETF (XBI) fell 1.6% after posting a rise in the previous session. Both the Technology Select Sector SPDR ETF (XLK) and the Consumer Discretionary Select Sector SPDR ETF (XLY) fell by 0.5% as of 3:00 PM EST on April 19.