In this episode of ETF Spotlight, I speak with Matthew Bartolini, Head of SPDR Americas Research at State Street Global Advisors. We discuss the market outlook and best strategies for the second half of 2020.

Stocks soared after better-than-expected jobs report while the outlook for the economy remains very challenging. Are stocks getting ahead of economic fundamentals?

The pandemic has already changed the way we live, work, and play, and some of these changes will be permanent. The SPDR S&P Kensho New Economies Composite ETF (KOMP - Free Report) provides exposure to many innovative companies disrupting traditional industries by leveraging advancements in artificial intelligence, robotics, and automation.

Tech is the best performing sector this year again.“We’ve seen two years’ worth of digital transformation in two months,” per Satya Nadella, CEO of Microsoft (MSFT - Free Report). Internet and software-based solutions got a boost with growing use of video conferencing, e-learning, telehealth, cloud technologies, and digital payments.

Digital transformation has increased the risk of security breaches and threats, and the need for cybersecurity solutions. The SPDR S&P Software & Services ETF (XSW - Free Report) and the SPDR S&P Kensho Future Security ETF (FITE - Free Report) are worth a look.

Many companies around the world are working on vaccines or treatments for the coronavirus but the odds of picking a winner from the virus are rather low and it is better to invest in broad biotech ETFs like the SPDR S&P Biotech ETF (XBI - Free Report).

We are likely to see greater adoption of robotics and automation so as to minimize human contact. The SPDR S&P Kensho Intelligent Structures ETF (SIMS - Free Report) could benefit from rising investment in infrastructure for a digitally connected but physically distanced world.

We also discuss other major trends from recent fund flows and the key risks to watch now.