Quality ETFs To The Rescue Amid Worsening Coronavirus Outbreak

Meanwhile, there are several factors which are instilling confidence in the U.S. market, the first being the accelerated coronavirus vaccine rollout that buoys hopes of faster U.S. economic reopening of non-essential businesses and the return to normalcy. Strengthening optimism, the United States has administered around 200 million doses of vaccines in less than 100 days of Biden administration, per a CNN report.

Additionally, the Fed’s continued dovish stance is increasing the chances of a speedy U.S. economic growth recovery from the coronavirus-induced sluggishness. The central bank has decided to maintain rates at a near-zero level until 2023, at least. Moreover, the central bank raised its economic growth outlook considering the vaccine and stimulus optimism and it also expects higher inflation this year.

It is also worth noting here that on Mar 31, Biden unveiled his $2.3-trillion infrastructure development plan that focuses on improving the American infrastructure. The proposal includes funds for restoring roads and bridges, shoring up affordable housing, backing clean-energy projects, and creating a nationwide broadband network. This will create millions of jobs, resulting in solid hiring in the coming months, and benefits sectors like basic materials, industrials, and utilities.

Further, the release of strong economic data like retail sales and unemployment has supported upbeat market sentiments. Notably, U.S. retail sales recorded the best gains during March in 10 months, according to a Reuters article. Markedly, sales surged 9.8% sequentially in March 2021 following a downward revision of 2.7% in the previous month. The metric also surpassed market predictions of a 5.9% rise.

Quality ETFs Worth Your Attention

Quality stocks are rich in value characteristics with a healthy balance sheet, high return on capital, low volatility, and high margins. These stocks also have a track record of stable or rising sales and earnings growth. In comparison to the plain vanilla funds, these products help lower volatility and perform rather well during market uncertainty. Further, academic research has proven that high-quality companies constantly provide better risk-adjusted returns than the broader market over the long term.

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