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3 Factors That Could Boost Wall Street ETFs Despite Tariff Uncertainty
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U.S. stocks remained volatile as investors processed a renewed wave of tariff uncertainty. The turbulence followed a decision by a federal appeals court on May 29 to temporarily reinstate former President Trump's global tariffs. This move came just a day after a trade court had deemed many of the tariffs illegal.
The temporary pause allows the appeals court time to fully review the case. The Trump administration is required to submit its legal briefings by June 9. In response to the appeals court’s decision, the White House indicated it is ready to take the matter to the Supreme Court if necessary.
Despite the tariff-related uncertainty, below we highlight a few factors that could boost Wall Street ETFs ahead.
Inside Big Tech Resilience
NVIDIA’s recent market-pleasing earnings performance gave Wall Street renewed hope that major tech companies can weather the uncertainties surrounding Trump’s trade measures, even as export restrictions create new challenges.
While the tech sector is still recovering from a pullback in February—triggered in part by market reactions to low-cost AI DeepSeek—this hasn't derailed investor optimism. Instead, the pullback caused some valuation corrections and set the stage for renewed focus on U.S. tech leadership and AI investment.
According to Bank of America, the current earnings cycle confirms that hyperscalers are continuing with their AI investment strategies, even if capex growth is moderating slightly (read: Why Big Tech ETFs Still Remain Great Bets).
Retail Investors’ Faith in Wall Street
Retail participation has been a major force behind the renewed strength in Wall Street. Steve Sosnick, chief strategist at Interactive Brokers, told Yahoo Finance that their customers bought heavily during April. “Buy the dip” has been working for them for the past few years. Since the market’s most recent bottom on April 8, the S&P 500 has climbed nearly 19%.
JPMorgan quantitative strategist Emma Wu reported that retail investors poured over $50 billion into U.S. equities from April 8 onward—surpassing the $46 billion seen between March and June 2020, as quoted on Yahoo Finance.
The week following Trump’s April 2 “Liberation Day” tariff announcement saw record dip-buying flows, including $3 billion in net purchases on April 3—the largest single-day retail buying total since VandaTrack began tracking such data in 2014.
Upbeat Q1 S&P 500 Earnings; Brighter Outlook if Court Blocks Tariffs?
Total Q1 earnings for the 477 S&P 500 members that have reported results are up +11.4% from the same period last year on +4.4% higher revenues, with 74.2% beating EPS estimates and 62.9% beating revenue estimates, per Earnings Trend.
However, trade tensions have weighed on estimates so far. Note that total S&P 500 earnings for the June quarter are expected to be up only +5.5% year over year on +3.8% higher revenues, with a broader and greater pressure on estimates relative to other recent periods.
Q2 earnings estimates for 15 of the 16 Zacks sectors are down since the quarter got underway, with Aerospace being the only exception. The Tech sector’s estimates are down since the start of the period, but they have notably stabilized in recent weeks. Given this backdrop, if the court ruling helps ease tariff tensions to some extent, the earnings outlook could improve considerably.
ETFs to Buy
Below we highlight a few exchange-traded fund (ETF) options that could be played currently.
The underlying Dow Jones U.S. Select Aerospace & Defense Index measures the performance of the aerospace and defense sector of the U.S. equity market. The fund charges 40 bps in fees (read: Boeing Soaring on Trump Bump: Time to Tap the ETFs?).
The underlying FTSE High Dividend Yield Index which is consists of common stocks of companies that pay dividends that generally are higher than average. The fund charges 6 bps in fees and yields 2.88% annually.
iShares Core S&P Total U.S. Stock Market ETF (ITOT - Free Report) – Zacks Rank #2
The underlying S&P Total Market Index tracks the broad equity market, including large, mid, small, and micro-cap stocks. The fund charges 3 bps in fees and yields 1.27% annually.
The Roundhill TSLA WeeklyPay ETF seeks to pay weekly distributions to shareholders while targeting enhanced returns corresponding to 120% of weekly performance of TSLAbase. The fund charges 99 bps in fees and yields 12.53% annually.
Note that Elon Musk has recently stepped down from his role as a special government adviser. This move could help improve the public image of the struggling Tesla. Notably, Musk’s political involvement has recently impacted Tesla’s brand perception in key markets.
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3 Factors That Could Boost Wall Street ETFs Despite Tariff Uncertainty
U.S. stocks remained volatile as investors processed a renewed wave of tariff uncertainty. The turbulence followed a decision by a federal appeals court on May 29 to temporarily reinstate former President Trump's global tariffs. This move came just a day after a trade court had deemed many of the tariffs illegal.
The temporary pause allows the appeals court time to fully review the case. The Trump administration is required to submit its legal briefings by June 9. In response to the appeals court’s decision, the White House indicated it is ready to take the matter to the Supreme Court if necessary.
Despite the tariff-related uncertainty, below we highlight a few factors that could boost Wall Street ETFs ahead.
Inside Big Tech Resilience
NVIDIA’s recent market-pleasing earnings performance gave Wall Street renewed hope that major tech companies can weather the uncertainties surrounding Trump’s trade measures, even as export restrictions create new challenges.
While the tech sector is still recovering from a pullback in February—triggered in part by market reactions to low-cost AI DeepSeek—this hasn't derailed investor optimism. Instead, the pullback caused some valuation corrections and set the stage for renewed focus on U.S. tech leadership and AI investment.
According to Bank of America, the current earnings cycle confirms that hyperscalers are continuing with their AI investment strategies, even if capex growth is moderating slightly (read: Why Big Tech ETFs Still Remain Great Bets).
Retail Investors’ Faith in Wall Street
Retail participation has been a major force behind the renewed strength in Wall Street. Steve Sosnick, chief strategist at Interactive Brokers, told Yahoo Finance that their customers bought heavily during April. “Buy the dip” has been working for them for the past few years. Since the market’s most recent bottom on April 8, the S&P 500 has climbed nearly 19%.
JPMorgan quantitative strategist Emma Wu reported that retail investors poured over $50 billion into U.S. equities from April 8 onward—surpassing the $46 billion seen between March and June 2020, as quoted on Yahoo Finance.
The week following Trump’s April 2 “Liberation Day” tariff announcement saw record dip-buying flows, including $3 billion in net purchases on April 3—the largest single-day retail buying total since VandaTrack began tracking such data in 2014.
Upbeat Q1 S&P 500 Earnings; Brighter Outlook if Court Blocks Tariffs?
Total Q1 earnings for the 477 S&P 500 members that have reported results are up +11.4% from the same period last year on +4.4% higher revenues, with 74.2% beating EPS estimates and 62.9% beating revenue estimates, per Earnings Trend.
However, trade tensions have weighed on estimates so far. Note that total S&P 500 earnings for the June quarter are expected to be up only +5.5% year over year on +3.8% higher revenues, with a broader and greater pressure on estimates relative to other recent periods.
Q2 earnings estimates for 15 of the 16 Zacks sectors are down since the quarter got underway, with Aerospace being the only exception. The Tech sector’s estimates are down since the start of the period, but they have notably stabilized in recent weeks. Given this backdrop, if the court ruling helps ease tariff tensions to some extent, the earnings outlook could improve considerably.
ETFs to Buy
Below we highlight a few exchange-traded fund (ETF) options that could be played currently.
iShares U.S. Aerospace & Defense ETF (ITA - Free Report) – Zacks Rank #1 (Strong Buy)
The underlying Dow Jones U.S. Select Aerospace & Defense Index measures the performance of the aerospace and defense sector of the U.S. equity market. The fund charges 40 bps in fees (read: Boeing Soaring on Trump Bump: Time to Tap the ETFs?).
SPDR NYSE Technology ETF (XNTK - Free Report) – Zacks Rank #1
The underlying NYSE Technology Index is composed of 35 leading U.S.-listed technology-related companies. The fund charges 35 bps in fees.
Vanguard High Dividend Yield ETF(VYM - Free Report) – Zacks Rank #2 (Buy)
The underlying FTSE High Dividend Yield Index which is consists of common stocks of companies that pay dividends that generally are higher than average. The fund charges 6 bps in fees and yields 2.88% annually.
iShares Core S&P Total U.S. Stock Market ETF (ITOT - Free Report) – Zacks Rank #2
The underlying S&P Total Market Index tracks the broad equity market, including large, mid, small, and micro-cap stocks. The fund charges 3 bps in fees and yields 1.27% annually.
Roundhill TSLA WeeklyPay ETF (TSW - Free Report)
The Roundhill TSLA WeeklyPay ETF seeks to pay weekly distributions to shareholders while targeting enhanced returns corresponding to 120% of weekly performance of TSLAbase. The fund charges 99 bps in fees and yields 12.53% annually.
Note that Elon Musk has recently stepped down from his role as a special government adviser. This move could help improve the public image of the struggling Tesla. Notably, Musk’s political involvement has recently impacted Tesla’s brand perception in key markets.