Will Coronavirus Vaccine Optimism Drive These ETFs?

The first company to start human clinical trials of its coronavirus vaccine candidate in the United States — Moderna (MRNA) — has also shown progress. According to data published in the New England Journal of Medicine, Moderna’s potential coronavirus vaccine candidate resulted in a “robust” immune response in all participants in its early stage human trial, per a CNBC article.

ETFs to Gain on Vaccine Optimism

Let’s take a look at some ETFs that can gain from the introduction of a coronavirus vaccine:

U.S. Global Jets ETF JETS

The coronavirus outbreak has hammered the U.S. economy, with the airline sector being one of the worst-hit spaces. The virus’ spread resulted in declining air travel with restrictions imposed by the government. Consequently, airlines’ top lines suffered a material impact as passenger revenues form the largest component of their total revenue base. In fact, with the pandemic showing almost no signs of waning, air travel demand is likely to remain stressed, at least in the near term. Looking at the stressed balance sheets of the carriers, it will be safe to say that the sector will surely get a boost from vaccine development.

The fund provides investors access to the global airline industry, including airline operators and manufacturers from all over the world. Holding 40 securities, the fund has AUM of $1.21 billion, with an expense ratio of 0.60% (read: 5 Sector ETFs That Beat the Market in June).

The Energy Select Sector SPDR Fund XLE

The coronavirus pandemic has dealt a heavy blow to the energy sector. Dented global energy demand and oversupply have also been hurting the sector for long. The outbreak has forced operators to cut costs significantly by suspending some of their major activities as well as trimming workforce. Per a recent Rystad Energy analysis of the latest US Bureau of Labor Statistics data, more than 100,000 oil and gas jobs are already lost with majority occurring in the support activities market. Precisely, the report further states that the support activities segment has seen a staggering retrenchment of 20% employees compared with February’s pre-pandemic levels.

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