For Immediate Release
Chicago, IL – March 6, 2018 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include First Trust NASDAQ Global Auto Index Fund CARZ, Guggenheim Solar ETF TAN, iShares U.S. Aerospace & Defense ETF ITA, Spirited Funds/ETFMG Whiskey & Spirits ETF WSKY and iShares U.S. Consumer Services ETF IYC.
Here are highlights from Monday’s Analyst Blog:
Trump Tariffs Put These Sector ETFs in Focus
Trump’s announcement that the United States will impose a 25% tariff on steel imports and a 10% tariff on aluminum imports has become the latest cause of concern for the U.S. economy and Wall Street. The tariffs are likely to result in an increase in raw material cost for manufacturers that use these metals.
Against this backdrop, with the help of an article published on npr.org, we highlight some sectors that could be impacted the most from the tariffs (read: Watch These ETFs as Trade War Risks Rise).
Both steel and aluminum are vital to the production of cars and trucks sold in America and would push up the sale prices of those vehicles considerably. The American Automotive Policy Council believes that the change would put the U.S. auto industry at a "competitive disadvantage."
However, the price hike won’t be the same for all. In this situation, First Trust NASDAQ Global Auto Index Fund should be monitored closely. However, since the fund invests only 19.67% in the United States, severe threat to the product is unexpected (read: ETFs in Focus Post Automobile Earnings).
Solar projects, wind turbines and energy storage units are also likely to be pricier. The tariff could result in a hike in the cost of offshore platforms and pipelines. In any case, the Trump administration's 30% tariff on imported solar cells and modules was put into effect this year (read: Trump's Import Tariffs: ETF & Stocks in Focus).
Now with extra price increases on steel and aluminum, “which are used in ground-mount and rooftop solar racking systems,” the sector could be hit hard. Alternative ETFs including Guggenheim Solar ETF should thus be followed with extra caution (read: Alternative Energy ETFs to Gain From First Solar Q4 Results).
U.S. aerospace industry thrives on steel and aluminum imports to construct aircraft. About 80% of an aircraft is made of aluminum. Aerospace and defense ETFs like iShares U.S. Aerospace & Defense ETF may also feel the pinch.
Last but not least, how can investors forget the beer industry? Imported aluminum is used to make beer cans. The announcement puts Spirited Funds/ETFMG Whiskey & Spirits ETF in focus.
Along with most market watchers, we too believe that companies will try to pass on some cost escalation to consumers. As a result, consumer ETFs like iShares U.S. Consumer Services ETF may get slightly hurt.
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GUGG-SOLAR (TAN): ETF Research Reports
ISHARS-US AEROS (ITA): ETF Research Reports
FT-NDQ GL AUTO (CARZ): ETF Research Reports
ETFMG-WSKY&SPRT (WSKY): ETF Research Reports
ISHARS-US CN CY (IYC): ETF Research Reports
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