Wall Street rebounded strongly from the Omicron-induced sell-offs on bargain hunting. The S&P 500 Index has risen 1.4% — its biggest gain since mid-October. The rally has been broad-based with the Dow Jones Industrial Average gaining 1.8%, its best showing since early March, and the tech-heavy Nasdaq rising 0.8%.
In fact, small-cap stocks as represented by the Russell 2000 Index has outperformed, climbing 2.7%. The solid trend was seen in ETF space as well with US Global Jets ETF JETS and Defiance Hotel, Airline, and Cruise ETF CRUZ making the most of the rebound, gaining nearly 6% on the day. iShares U.S. Home Construction ETF ITB, Simplify Volt Cloud and Cybersecurity Disruption ETF VCLO and VanEck Vectors Steel ETF SLX was up about 4% each.
Investors jumped to flock stocks at bargain prices after the worst two-day drop in more than a year. The worries over the impact of the spread of new variant of COVID-19 has eased with early indications of the strain being mild in most cases. The wider reach of vaccinations and COVID-19 boosters should help to reduce infections caused by the new variant of COVID-19 (read: 5 Inverse ETFs Up Over 10% on Black Friday).
Additionally, the economy is on a firmer footing with stronger-than-expected consumer confidence, a pick-up in hiring and rising wages. Further, concerns over the government shutdown have also averted. The Senate has passed a stopgap spending bill that avoids a short-term shutdown and funds the federal government through Feb 18. The measure now goes to President Joe Biden to be signed into law.
We have highlighted ETFs in detail below:
U.S. Global Jets ETF (JETS)
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world by tracking the U.S. Global Jets Index. The product holds 51 securities and charges 60 bps in annual fees (read: Sector ETFs to Win or Lose on Oil Slump).
U.S. Global Jets ETF has gathered $3.2 billion in its asset base while sees heavy trading volume of nearly 7.7 million shares a day. JETS has a Zacks ETF Rank #3 (Hold) with a High risk outlook.
Defiance Hotel, Airline, and Cruise ETF (CRUZ)
Defiance Hotel, Airline, and Cruise ETF tracks the BlueStar Global Hotels, Airlines, and Cruises Index, which measures the performance of globally listed companies primarily engaged in the travel and tourism industries. Holding 53 stocks in its basket, American firms make up for 45.8% of the portfolio while Panama, Japan and the United Kingdom round off the next three with a single-digit exposure each.
Defiance Hotel, Airline, and Cruise ETF, launched in June, has gathered around $14.6 million in its asset base and charges 45 bps in annual fees. Volume is lower as it exchanges around 32,000 shares a day on average.
iShares U.S. Home Construction ETF (ITB)
iShares U.S. Home Construction ETF provides exposure to U.S. companies that manufacture residential homes by tracking the Dow Jones U.S. Select Home Construction Index. With AUM of $2.9 billion, it holds a basket of 46 stocks with a heavy concentration on the top two firms.
iShares U.S. Home Construction ETF charges 41 bps in annual fees and trades in a heavy volume of around 2.6 million shares a day on average. It has a Zacks ETF Rank #2 (Buy) with a High risk outlook (read: 5 Best Sector ETFs of November).
Simplify Volt Cloud and Cybersecurity Disruption ETF (VCLO)
Simplify Volt Cloud and Cybersecurity Disruption ETF is a thematic investment product and is actively managed. It is designed to concentrate on those few disruptive companies that are poised to dominate the new era of cloud technology and then enhance the concentrated exposure with options. Simplify Volt Cloud and Cybersecurity Disruption ETF holds 29 securities in its basket with a double-digit allocation on the top firm.
Simplify Volt Cloud and Cybersecurity Disruption ETF is a high-cost choice, charging 0.96% in annual fees. VCLO has accumulated $19.7 million in its assets base in nearly one year of inception and trades in an average daily volume of 37,000 shares.
VanEck Vectors Steel ETF (SLX)
VanEck Vectors Steel ETF provides a pure-play exposure to a small basket of 25 stocks in the steel sector. It tracks the NYSE Arca Steel Index. American firms dominate the fund’s returns at 39.2%, followed by Brazil (18.9%) and Australia (14.2%).
VanEck Vectors Steel ETF has amassed $120.8 million in its asset base and charges 56 bps in fees from investors. It trades in a moderate volume of 80,000 shares a day on average.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.