JETS, IAI Soar on Earnings; SHOC Dips on ASML Outlook

ETFs were mixed Wednesday as traders shifted through the latest corporate earnings reports, with gains in transportation and financial sectors offset by losses in semiconductors.

The U.S. Global Jets ETF (JETS) rose 4.2% after United Airlines shares surged nearly 12.5%. The airline posted strong earnings and revenue for the third quarter. United also announced the start of a $1.5 billion share buyback program, its first since the Covid-19 pandemic.

The iShares U.S. Broker-Dealers & Securities Exchanges ETF (IAI) gained 1.6% as Morgan Stanley shares closed up nearly 6.6%. The bank reported second quarter results that beat Wall Streets's forecasts, boosted by higher profits from its wealth management, trading and investment banking divisions.

In the transportation sector, the First Trust Nasdaq Transportation ETF (FTXR) climbed 2.1% after General Motors shares increased more than 2.4%. The automakers stock rose on news of an agreement with Lithium Americas Corp. to establish a joint venture, which includes GM investing $625 million in cash and credit to the Canadian mining business. 

In contrast, the Strive U.S. Semiconductor ETF (SHOC) fell 0.3% following ASML's earnings release. Shares of the semiconductor equipment maker slumped 6.4% after the Dutch company mistakenly released its third-quarter earnings earlier than expected. ASML also cut its sales outlook for 2025, citing a slower-than-expected recovery in segments beyond AI. 

Bank ETFs are rising as Wall Street heavy-hitters report strong quarterly earnings, while broader markets are mixed after chipmaker ASML reported results that missed analysts' expectations.

The Financial Select Sector SPDR Fund (XLF), which holds banks including JPMorgan Chase & Co. and Bank of America Corp., rose 0.7% late morning. The SPDR S&P Regional Banking ETF (KRE), which holds smaller banks like M&T Bank Corp., jumped 1.6%.

Bank exchange-traded funds have been rising as banks beat earnings expectations while signaling that their health is a sign that the Federal Reserve is successfully taming inflation without sparking a recession. Morgan Stanley this morning joined other big banks in reporting third-quarter profit that topped Wall Street estimates.

Optimism for a stronger economy with lower interest rates may lie behind this morning's 1.6% gain in the iShares Russell 2000 ETF (IWM).

Broad equity indexes turned higher. The SPDR S&P 500 ETF Trust (SPY) moved into the green, adding 0.1% while the SPDR Dow Jones Industrial Average ETF Trust (DIA) gained 0.4%. The Fidelity NASDAQ Composite Index ETF (ONEQ) which tracks the tech-heavy Nasdaq, fell 0.1% as Dutch chipmaker ASML disappointed investors with its results.

Big bond ETFs gained. The iShares 20+ Year Treasury Bond ETF (TLT) added 0.7% and the Vanguard Total Bond Market ETF (BND) rose 0.2%.