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Wall Street Rises on Trump's Stimulus: ETF & Stock Gainers

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After Fed’s massive emergency monetary stimulus, President Trump came up with a fiscal stimulus package. Trump is now mulling over a “very substantial relief” to the payroll tax (read: Emergency Fed Cut Less Effective: ETFs That Should Survive).

The likely tax incentives will add to the $8.3-billion spending package signed by President Trump last week.The package was intended to back research on vaccines as well as support states struggling with the outbreak.

Trump also mentioned that the White House will cooperate with the struggling airline and cruise industries. In response, cruise shares Carnival Corporation (CCL - Free Report) (up 10.5%) and Royal Caribbean Cruises Ltd. (RCL - Free Report) (up 7.0%) gained materially on Mar 9.

Notably, global airlines are likely to lose $113 billion in sales if the virus continues to spread, per the International Air Transport Association. If the crisis ends soon and economies start to recover, losses could be limited to $63 billion (read: 4 Sector ETF Winners of Bull Market Look Resilient to Virus).

Trump’s aid announcement boosted the Dow Jones, the Nasdaq Composite and the S&P 500 by 4.89%, 4.95% and 4.94%, respectively on Mar 10. However, such policy measures are less likely to boost markets as the latest crisis is supply shock-driven and people are less likely to step outside even if they have plenty of cash.

ETF Gainers

iShares U.S. Regional Banks ETF (IAT - Free Report) – Up 7.24% on Mar 10

Chances of fiscal stimulus boosted the long-term U.S. treasury bond yields, resulting in a steepening yield curve. This proved beneficial for bank stocks. Moreover, investors should note that bank stocks have cheaper valuation at the current level and offer a good entry point (read: Why Bank ETFs Are Rising).

U.S. Global Jets ETF (JETS - Free Report) – Up 6.16% on Mar 10

U.S. airline stocks have risen on Mar 10 backed by stimulus hopes as well as industry-wide restructuring. United Airlines (UAL - Free Report) (up 12.36% on Mar 10), Delta (DAL - Free Report) (up 4.48%) and American Airlines (AAL - Free Report) (up 15.25%) have plans of cutting capacities. While most cuts will be focused on trans-Pacific routes, there will be a 10% reduction on the domestic route as well. Apart from this, airlines companies are incorporating cost-cutting measures in various forms. United Airlines now expects demand to return to prior levels in a year and a half.

VanEck Vectors Semiconductor ETF (SMH - Free Report) – Up 6.16% on Mar 10

Semiconductor stocks have affected by coronavirus-related selloffs and thus had an easy chance to surge once markets rebounded. Plus, there were deals related good news in the semiconductor sector (read: Buy These ETFs as Nvidia Returns to Revenue Growth).

Stock Winners

Aytu BioScience Inc. (AYTU - Free Report) – Up 489.1% on Mar 10

The pharmaceutical company rallied on its announcement of the signing of an exclusive distribution agreement for commercializing a clinically validated and commercially-used coronavirus 2019 (COVID-19) IgG/IgM Rapid Test.

Enable Midstream Partners LP – Up 154.3% on Mar 10

Oil prices bounced back on Mar 10 after a historic selloff the day before. There was a volley of announcements regarding capex cuts. The news boosted the mid-stream space. Investors should note that $20/$30 oil for long might cause bankruptcies for drillers. This in turn might lead them to miss out on payments to midstream companies for carrying oil. If this happens, midstream companies may have to bring down their high dividend payouts, per an article published on Motley Fool.

Cypress Semiconductor Corporation – Up 48.9% on Mar 10

Cypressshares surged on receipt ofa key approval in its proposed acquisition by Germany-based Infineon.

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