"Build Back Better" Plan of Biden to Boost These ETFs
Chances are rising that the blue wave of Democrats will take control of the House and Senate in November. Democratic presidential candidate Joe Biden now has better chances of winning the November election, according to national polls and forecasts.
The Democratic contestant is almost 10 points ahead of Trump in FiveThirtyEight's average of national head-to-head surveys, and steadily remains ahead of the President in key swing states like Florida, Michigan and Arizona, per a newsweek.com article.
One poll from Monmouth University issued on Jul 2 put Biden 12 points ahead of Trump nationwide. Biden currently has the support of 53% of voters and Trump has 41% Americans backing him. According to The Economist election forecast, Biden has about 90% chances of winning the electoral college and an astounding 98% probability of winning the popular vote in just four months remaining to the election(read: Blue Wave to Hit America? Sector ETFs to Win or Lose).
Against this backdrop, Joe Biden recently released the second part of his Build Back Better plan. The plan makes a winning investing case for the below-mentioned investing areas and ETFs.
Auto
The main focus was on infrastructure and clean energy but the auto industry also received enough attention. Biden promises – through federal spending – to promote automakers and its suppliers. "Together, this will mean 1 million new, well-paying jobs in the American automobile industry" per Biden, as quoted on yahoofinance. Biden played an important role in the 2009 bailouts of General Motors and Chrysler.
According to the source, about 47% of total electric vehicles running globally are on the roads of China and 20% are in the United States. The majority of U.S. electric vehicles are made by Tesla (TSLA). Now, Biden plans to upgrade 3 million vehicles into the electric form that the government regularly purchases. These vehicles would be made and sourced from America (read: Trump or Biden, Small-Cap Stocks & ETFs to Gain).
The plan also envisages new job creation through the federal government helping to build 500,000 electric vehicle charging stations, and supporting research focused on battery technology. The net beneficiaries will be First Trust NASDAQ Global Auto Index Fund CARZ, ARK Industrial Innovation ETF (ARKQ), First Trust Nasdaq Transportation ETF (FTXR) andGlobal X Lithium & Battery Tech ETF Fund LIT.
Clean Energy
Needless to say, like many other democratic leaders, Biden is also a proponent of clean energy investing. If Democrats rule the Congress and White House again, the stocks in the space will get a boost. Biden is forming a plan — a Clean Energy Revolution — to address the issue of climate emergency. He sees America becoming a 100% clean energy economy and having net-zero emissions no later than 2050.
The move could further benefit stocks like First Solar Inc. (FSLR) or electric vehicle giant Tesla TSLA and ETFs like Invesco Solar ETF TAN and iShares Global Clean Energy ETF (ICLN). The United States has about 40% exposure to the global fund ICLN.
Infrastructure
Joe Biden proposed $1.3 trillion infrastructure overhaul last year. Though he said he will fund the plan through tax increases on the wealthy and corporations, we see moderate increases in both tax rates as well as infrastructure activities under Biden’s rule.
The Democratic presidential candidate’s campaign aims to invest in restoring highways, roads and bridges, while trying to boost the adoption of electric vehicles and trains. His plan also calls for changing water pipes, building out rural broadband access and updating schools, among other measures.
From this agenda, ETFs like iShares U.S. Infrastructure ETF IFRA andInvesco Dynamic Building & Construction ETF (PKB) will be the winning ones.
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Tesla, Inc. (TSLA) : Free Stock Analysis Report
Invesco Solar ETF (TAN): ETF Research Reports
First Trust NASDAQ Global Auto ETF (CARZ): ETF Research Reports
Global X Lithium Battery Tech ETF (LIT): ETF Research Reports
First Trust NASDAQ Transportation ETF (FTXR): ETF Research Reports
iShares U.S. Infrastructure ETF (IFRA): ETF Research Reports
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