5 Must-See ETF Charts On Earnings & Trade War Impact
Zacks Investment Research | May 27, 2019 10:10PM ET
After reaching a peak at the end of April on better-than-expected earnings, U.S. stocks faltered on worsening trade spat between the United States and China. Additionally, growing fears of Brexit without a deal and bouts of weak economic data added to the woes. The combination of the factors is paving the way for the worst May in seven years.
Coming to the latest earnings reporting cycle, it was better than expected. This is because Q1 earnings for 96% of the S&P 500 Index market capitalization increased 0.1% on 4.8% revenue growth, with 76.7% beating EPS estimates and 59.6% surpassing top-line expectations, according to the latest KBWP
This fund offers exposure to companies primarily engaged in U.S. property and casualty insurance activities. It has gained 5.5% on earnings optimism and the improving economy backed by a solid job market, growing wages and rising consumer confidence that is leading to higher demand for all types of insurance services. It has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
Virtus Reaves Utilities ETF (SI:UTES)
This fund seeks to provide total return through a combination of capital appreciation and income, primarily through investments in equity securities of companies in the utility sector. It has gained 3.3% over the past month on investors’ flight to defensive investment. Being a low-beta sector, it is relatively protected from large swings (ups and downs) in the stock market and is thus considered safe haven amid economic or political turmoil. Though the sector registered decline in revenues of 0.2% this earnings season, its earnings grew a decent 4.4% and supported the rally in UTES.
First Trust North American Energy Infrastructure Fund IHF
This fund offers exposure to U.S. companies that provide health insurance, diagnostics, and specialized treatment. Total earnings for 95.8% of the total healthcare market capitalization are up 7.8% on revenue growth of 6.5%, with 86.5% beating EPS and 69.2% beating revenue estimates. IHF is up 1.5% in a month and has a Zacks ETF Rank #2 (Buy) with a Medium risk outlook.
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SPDR S&P Aerospace & Defense ETF (LON:XAR)
This ETF offers equal-weight exposure to aerospace & defense stocks and has risen 1% on a combination of escalation in trade dispute and earnings. Notably, total earnings from 100% of the sector’s total market capitalization are up 6.9% on 10.1% higher revenues, with 90% of the companies beating on earnings and 80% exceeding top-line estimates. Earnings beat ratio is the highest when compared to the other sectors. The fund has a Zacks ETF Rank #2 with a Medium risk outlook (read: Original post
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