Transportation ETF (XTN) Hits New 52-Week High

XTN

For investors seeking momentum, SPDR S&P Transportation ETF (XTN - Free Report) is probably on radar. The fund just hit a 52-week high and is up 31.20% from its 52-week low price of $348.11/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of where it might be headed:

XTN in Focus

The underlying S&P Transportation Select Industry Index represents the transportation segment of the S&P Total Market Index. The fund has major allocations to cargo ground transportation (30.85%), passenger airlines (27.05%) and air freight and logistics (17.65%). The product charges 35 bps in annual fees (See: all Industrial ETF here).

Why the Move?

A surprise swing exhibited by the U.S. economy in the second quarter of 2023, with consumers and businesses showing remarkable resilience despite elevated interest rates, is a positive for the sector. Solid economic growth results in higher activities.

U.S. airline stocks are on an upward trajectory, buoyed by robust indications of travel demand during the summer season. The resilience in travel spending following the pandemic has contributed to the promising outlook for the industry.

More Gains Ahead?

Currently, XTN has a Zacks ETF Rank #2 (Buy) and might continue its strong performance given a positive weighted alpha of 23.50.

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