Best ETF Ideas For The Second Half Of 2021

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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 2021.

Major stock indexes continue to march higher in 2021. The SPDR S&P 500 ETF (SPY - Free Report) has gained 15% while the SPDR Dow Jones Industrial Average ETF (DIA - Free Report) and the Invesco Nasdaq 100 ETF (QQQ - Free Report) are up 13% each so far this year.

With increased COVID-19 vaccination rates, massive fiscal stimulus programs, and accommodative monetary policies, the economy and earnings grew strongly in the first quarter, and the second-quarter numbers are also expected to be very impressive.

Economically sensitive cyclical stocks had a very strong run this year. Energy remains the top performer among all sectors, up more than 43% year-to-date, but tech has regained leadership over the past few weeks. Some cyclical sectors like financials and industrials had negative returns over the past month and Matt sees this an opportunity to add exposure to them.

State Street expects value stocks, banks, miners, retailers, and homebuilders to continue to benefit from the reopening rally. The SPDR Portfolio S&P 500 Value ETF (SPYV - Free Report), the SPDR S&P Bank ETF (KBE - Free Report), and the SPDR S&P Metals and Mining ETF (XME - Free Report) are worth a look.

The pandemic has 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.

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