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Financial ETFs Rise on Earnings Surprises

Better-than-expected earnings from European banks buoy financial ETFs.

NEW YORK (

TheStreet

) -- Financial ETFs rose on Tuesday after Swiss bank

UBS

(UBS) - Get UBS Group AG Report

and Germany's

Deutsche Bank

(DB) - Get Deutsche Bank AG Report

reported stronger-than-expected numbers, revised Basel III proposals were less stringent than expected and concerns about the health of European banks abated following the stress tests.

The

iShares S&P Global Financials

(IXG) - Get iShares Global Financials ETF Report

rose 1.7% to $44.07 on Tuesday. Its top holding

HSBC

(HBC)

ended higher by 2.6%.

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America's big banks

Bank of America

(BAC) - Get Bank of America Corp Report

,

JP Morgan

(JPM) - Get JPMorgan Chase & Co. Report

and

Wells Fargo

(WFC) - Get Wells Fargo & Company Report

rose in early Tuesday trading as financial ETFs attracted buyers, though gains ebbed towards the end of the trading session.

The

SPDR Regional Banking ETF

(KRE) - Get SPDR S&P Regional Banking ETF Report

climbed 1.6% after

Regions Financial

(RF) - Get Regions Financial Corporation Report

became the latest large regional bank to beat estimates with higher than expected improvements in credit quality. It ended up nearly 1% higher at $24.29.

Utility ETFs were in the limelight on Tuesday.

Utilities HOLDRS

(UTH)

and

Vanguard Utilities

(VPU) - Get Vanguard Utilities ETF Report

were up 1.6% and 1.5% respectively.

Consumer-focused ETFs such as the

SPDR S&P Retail

(XRT) - Get SPDR S&P Retail ETF Report

and

SPDR Consumer Discretionary

(XLY) - Get Consumer Discretionary Select Sector SPDR Fund Report

saw some selling after consumer confidence sank to a five-month low. The funds were down by 1.7% and 1.3% respectively.

The

United States Oil Fund

(USO) - Get United States Oil Fund LP Report

was shedding 1.9%, with the price of oil slipping nearly 2% to $77.43.

-- Reported by Shanthi Venkataraman in New York.

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