Best & Worst ETF Zones At Half-Way Q1

Through the first half of first-quarter, 2020 stocks across the globe have been on a smooth ride amid the fast-spreading coronavirus, which has infected at least 64,000 people in China and killed 1,400. It is also weighing on global economic growth.

The gains were driven by initial U.S.-China trade deal, China stimulus measures, easing policies and slew of upbeat economic data. China has halved tariffs on some $75 billion of U.S. imports, beginning Feb 14, as part of its phase-one trade deal with the United States. Tariffs on some U.S. goods will be cut to 5% from 10%, while levies on some other items will be reduced to 2.5% from 5%, per China’s Ministry of Finance. The tariffs were imposed in September and December during a trade fight between the world’s two largest economies. Also, the People’s Bank of China has injected $1.7 trillion yuan ($242.9 billion) into the economy .

Meanwhile, the U.S. economy has been resilient. In particular, the labor market was off to a strong start in 2020, creating 225,000 new jobs in January. The manufacturing sector, which had languished in contraction territory for five months, rebounded strongly in January while services sector activity also picked up, with industries reporting increases in new orders. Retail sales also strengthened for a fourth consecutive month. The solid data suggests that the economy could continue to grow moderately this year.  

Given this, we have highlighted the best and worst-performing zones and their ETFs in the first half of the first quarter:

Best Zones

Palladium

Palladium continued last year’s bullish run on growing global demand and stagnating supply. As a result, Aberdeen Standard Physical Palladium Shares ETF (PALL - Free Reporthas climbed 25.8% so far this year. The fund seeks to match the price of palladium. It owns palladium bullion in plate or ingots kept in Zurich or London under the custody of JPMorgan Chase Bank. The product has amassed $393.2 million in its asset base and trades in lower volume of about 39,000 shares a day. It charges 60 basis points (bps) in annual fees and has a Zacks ETF Rank #3 (Hold) with a High risk outlook.

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