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5 ETFs to Play as New US COVID-19 Cases Continue to Drop

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The coronavirus outbreak seems to getting under control in the United States as the number of new cases continues to decline. Going by data compiled by Johns Hopkins University, the seven-day average of new infections was about 26,000 as of May 23, per a CNBC article. Encouragingly, the number of cases has declined to the lowest level since June 2020.

Accelerated coronavirus vaccine rollout has been the major factor that has helped gaining control over the aggravating outbreak. President Joe Biden recently announced his latest vaccination goals. He aims at administering at least one dose of a coronavirus vaccine to 70% of U.S. adults along with getting 160 million adults completely vaccinated by Jul 4.

Notably, more than 151 million Americans belonging to the age group of 18 years and above or 58.7% of the U.S. adult population, have been administered at least one dose of a COVID-19 vaccine as of May 12, per data from the Centers for Disease Control and Prevention (CDC) (as mentioned in a CNBC article).  Moreover, about 116 million American adults or 45.1% of the U.S. adult population are completely vaccinated, according to the CDC.

The decline in the number of coronavirus cases has increased optimism among market participants toward faster recovering and reopening of the U.S. economy. An increasing number of people are expected to travel and go for vacations starting Memorial Day weekend, which is also considered to be the unofficial beginning of the summer travel season, according to the same article.

Going on, the latest public health guidelines issued by the CDC has relaxed restrictions on wearing masks at indoor and public gatherings. According to the new recommendations, completely vaccinated people do not need to wear masks or stay six feet away from others at indoor or outdoor gatherings, per a CNBC article.

A change in consumer behaviour and shopping patterns is also being observed as Americans are visiting stores for shopping merchandise like new clothes which signal toward normalcy. Large retailers like Walmart (WMT - Free Report) , Target (TGT - Free Report) , Home Depot and Macy’s have been gaining from the reopening economy and gradual return to normalcy.

ETFs to Ride the Reopening Optimism

Against this backdrop, let’s look at the following ETFs that are well-poised to gain as the reopening of U.S. economy picks up pace:

Fidelity MSCI Consumer Discretionary Index ETF (FDIS - Free Report)

The increase in direct payments to Americans comes as a ray of hope for players in the consumer discretionary sector, which attracts a major portion of consumer spending. The fund intends to provide investment results that before expenses correspond generally with the price and yield performance of the MSCI USA IMI Consumer Discretionary Index. It has an expense ratio of 8 basis points (read: U.S. Consumer Sentiment Drops in May: ETFs That May Suffer).

Vanguard Industrials ETF (VIS - Free Report)

The industrial sector, which faced disruption in global supply chains and factory closedowns, is expected to rebound on recovery from the coronavirus-led slump. The re-opening of the U.S. economy, introduction of a coronavirus vaccine and addition of stimulus are expected to drive demand and economic activities in the sector. The fund tracks the MSCI US Investable Market Industrials 25/50 index and has an expense ratio of 0.10% (read: ETFs to Gain as US Industrial Output Rises in April).

The Energy Select Sector SPDR Fund (XLE - Free Report)  

The energy sector bled profusely due to the pandemic-induced historically low oil price levels, thanks to the dual blows of low demand and surplus supplies. Notably, a surge in coronavirus cases weighed on oil demand. However, reduction in oil supply, increased fiscal stimulus, rise in industrial production and a weak dollar as the Fed remained super dovish are working in support of oil prices and will continue to favor the sector amid the re-opening of the U.S. economic scenario. XLE seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Energy Select Sector Index. The fund charges 0.12% in expense ratio (read: Key Winning ETF Areas Despite Subdued April Manufacturing Data).

U.S. Global Jets ETF (JETS - Free Report)

Studying the stressed balance sheets of the carriers, it will be safe to say that the space is likely to get huge support from the reopening of the U.S. economy. JETS provides investors access to the global airline industry, including airline operators and manufacturers across the world. The fund has an expense ratio of 0.60% (read: Play Reopening -- Friendly ETFs Ahead of Memorial Day).

ETFMG Travel Tech ETF (AWAY - Free Report)

The travel industry will be getting the much-needed boost from the reopening of the U.S. economy, accelerated coronavirus vaccine rollout initiatives and introduction of another round of fiscal stimulus. This fund is the first ETF to focus on technology-focused global travel and tourism companies. It charges an expense ratio of 0.75% (read: 2 Hotel & Restaurant ETFs Debut: Will They Taste Success?).

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