Markets will have a shortened week to digest new data as a result of the Labor Day weekend holiday. Here are the key ETFs to watch for the week of Monday, September 1, 2014:
iShares NASDAQ Biotechnology ETF (NASDAQ:IBB)
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Biotech stocks have regained their leadership status and broke out to new all-time highs last week. After a brief bout of volatility in the second quarter, these favored momentum stocks are soaring once again and topped their prior February highs.
IBB is the largest ETF in this space, with $5.5 billion in total assets. This fund tracks 121 companies engaged in technology research and development for the medical field. The largest holdings in this market cap weighted vehicle include Gilead Sciences (NASDAQ:GILD) and Celgene Corp (NASDAQ:CELG).
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So far this year, IBB has gained nearly 22 percent and will look to add to those gains if the health care rally continues.
United States Oil Fund (NYSE:USO)
Crude oil futures closed at their highest level in weeks after a multi-month sell off that included a break below $95 per barrel. USO tracks the daily change in the spot price of West Texas Intermediate Crude Oil, which rose more than one percent on Friday.
The biggest question mark for USO is whether this consolidation and recent move upward will morph into a new uptrend or resolve prices lower once again. One potential upside catalyst traders will be watching is the conflict between Russia and Ukraine, which appears to be escalating to new heights.
A key level to watch in USO is the 200-day moving average at $36, which coincides with $100 per barrel for crude prices. A push back above this level may renew bullish interest in oil prices.
iShares MSCI Brazil Capped ETF (NYSE:EWZ)
Brazilian equities were another area of strength last week, and pushed to a multi-year high. EWZ tracks 74 large and mid-cap companies that are located in or have primary business interests in this key emerging market economy.
Despite recent GDP output indicating recessionary pressures, EWZ has been forging ahead in recent months amid a scheduled general election season in October. A changing of the guard may have a profound impact on the $5.5 billion invested in this country-specific ETF.
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