Since the U.S. economy grew 3.5% – the best in the last two years – in the third quarter of 2016, we can easily pronounce that the year 2017 to be a favorable one for the domestic economy. This is especially true given that President-elect Trump has promised fiscal reflation after taking office.
Personal consumption, investment and government expenditure grew faster than anticipated in Q3. Meanwhile, consumer confidence peaked to a 15-year high in December buoyed by a Trump-induced market rally and stable job market. The unemployment rate declined to a nine-year low of 4.6%.
U.S. auto sales came in unexpectedly strong in December thanks to soaring consumer confidence. Industry-wide sales grew 3.1% to 1.69 million in December while sales for the full year went up 0.4% year over year to 15-year high. Low fuel prices were also catalysts to stellar auto sales (read: Auto Sales Hit Fresh High in 2016: ETFs & Stocks to Ride On).
The world’s largest economy left a bullish mark in every economic indicator, be it consumer confidence, housing numbers, manufacturing activities, corporate profits and currency. Despite a frozen start, the U.S. closed the year on a strong note.
Amid all the positives, investors should note that the Fed’s policy tightening may cause a jump in yields and spell trouble for rate-sensitive sectors. Whatever the case, we have highlighted five sectors and the related ETFs that promise substantial expected growth rate for 2017 and could be better plays in the near term. We also highlight five sector specific stocks that could serve as a buy candidate.
Auto
First Trust NASDAQ Global Auto Index Fund (CARZÂ -Â Free Report)
Strong sales data at the end of 2016 excites us to bet on this auto ETF. As per the source, China is expected to be a tailwind to global auto sales in 2017 thanks to increased adoption of new-energy vehicles and smart connected cars.
