ETFs Endure Another Session of Wild Swings

Market Wrap-Up

Computer giant Hewlett-Packard (HPQ) got the stock market off to a good start Tuesday when it announced its fourth-quarter non-GAAP earnings per share hit $1.03, up 20% from the same time period last year. HP shares finished the day up 14.5%. That news helped the Dow Jones Industrial Average initially jump over 200 points in early morning trading. The rally didn’t last, though.

As has been the norm the last few months, the Dow couldn't manage to stay on the same footing for the entire session. Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke appeared once again in front of a congressional committee to explain some decisions regarding the economy and the government's $700 billion bailout plan for the financial-services industry. Paulson sparred with some politicians, explaining the intent of the plan was to serve as a mechanism for stabilizing the financial system and not as an economic stimulus. There were also hearings on bailing out the automobile industry, which is asking for a controversial $25 billion bailout.

The news coming out of the financials continues to be poor. Barclays (BRC) announced a controversial capital injection plan. It and other firms like Goldman Sachs (GS) also said its executives would wave their year-end bonuses. There was other boardroom news for investors to contemplate. Yahoo (YHOO) CEO Jerry Yang stepped down after a tenure that was characterized by a brutal battle with rival Microsoft (MSFT). Home Depot (HD) announced third-quarter earnings that were lower than last year's numbers but ahead of analyst estimates. The Producer Price Index, a measure of inflation, plunged 2.8%, a sign of falling commodity prices, leading to chatter about deflation.

The price of a barrel of oil jumped around during Tuesday's session as traders tried to gauge the damage caused by pirates who hijacked an oil tanker off the coast of Africa on Monday. The threat posed by the pirates could force some tanker companies to avoid the area, cutting into or slowing deliveries. Crude fell almost $1 to $54.

The Dow whipped around the entire session, originally opening up over 200 points before coming back to even territory and even dropping 100 points into negative territory. But as the closing bell approached, a late rally sent the Dow up 151 at the close to 8,424.

Winners

Aggressive investors continue to make aggressive bets on the financial-services industry. Tuesday, it was the super bears' turn to post big profits. The Direxion Financial Bear 3X Shares ETF (FAZ) gained 5.8%.

Losers

HP's rosy quarter helped its own shares gained 14.5%. But its weak guidance -- and some spotty numbers from industry bellwethers -- made for a rough day for semiconductor ETFs. The SPDR S&P Semiconductor (XSD) dropped 7.5%.

A slowing economy, cheaper gas and poor earnings numbers have taken a toll on the once-red hot solar ETFs. The Market Vectors Solar Energy ETF (KWT) lost 7.8%.

Tuesday's Industry Headlines

Launching Pad
Last week Northern Trust started trading the Nets FTSE CNBC Global 300 fund. This ETF tracks an index of the 15 largest companies from 18 sectors along with the 30 largest firms from certain emerging markets. It charges an annual expense ratio of 0.43%.

Wednesday's Notebook

Earnings & Conference Calls
BJ's Wholesale Club, Dress Barn, Gymboree, Hot Topic, Intuit, LDK Solar, Men's Wearhouse, PetSmart, Ross Stores, Tween Brands

Economic Data
8:30a.m. Sept. Consumer Price Index
8:30a.m. Sept. CPI, Ex-Food & Energy
8:30a.m. Sept. Housing Starts
10:35a.m. Nov. 14 U.S. Energy Dept. Oil Inventories
11:00a.m. Nov. 14 API Oil Industry Report
2:00p.m. Oct. 28 FOMC Minutes

Quick Take

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