Many cities and towns across the United States will have parades and observances, for the sacrifices made for this land, says Alejandro Martínez-Cabrera for The San Francisco Chronicle. (Reasons that you may prosper from an aerospace and defense ETF.)

Related ETFs that are in line with this day include:

• PowerShares Aerospace and Defense (NYSEArca: PPA): up 17.4% year-to-date

• iShares Dow Jones US Aerospace (NYSEArca: ITA): up 17.9% year-to-date

Have a nice Veterans Day!

For more stories about aerospace and defense, visit our aerospace and defense category.

Here are some points in favor of the aerospace and defense industy:

• Defense Industry Daily says that momentum had been building to sell the F-22A Raptor overseas to countries considered allied with the United States, such as Japan. But F-22 production is set to end sometime around 2010; exporting them could delay the need to make a decision. As far as Japan goes, the F-22 “is at the top of their list.”
• Mike Allen for San Diego Business Journal reports that this industry could be one of the major employment opportunities in the United States. General Atomics, which makes the unmanned drones used extensively in the Middle East wars, has added 800 jobs in the past year.
• Meanwhile, the Navy plans to commission a new amphibious assault ship, the USS Makin Island, this week, and next year the USS Carl Vinson becomes the third aircraft carrier to be home-ported locally.
• The ongoing strife in Afghanistan has led to a dilemma for Obama, who needs to decide whether to send more troops. If troops are increased again, it could keep defense spending elevated. Also worth noting is that, according to Martha Raddatz at ABC News, the troops that were part of the increase ordered in February are still not there yet. This is because the military needs time to organize the supplies these additional forces will need.

On the downside, Boeing (NYSE: BA) reported a $1.6 billion loss in the third quarter, thanks to delays in the 787 Dreamliner program.

For more stories about aerospace, visit our aerospace and defense category.

• PowerShares Aerospace & Defense (NYSEArca: PPA): up 16.9% year-to-date

• iShares Dow Jones U.S. Aerospace & Defense (NYSEArca: ITA): up 17.3% year-to-date

Reuters reports that big defense contractors could be set to lose jobs as the Pentagon cuts traditional spending on weapons. In turn, the smaller, specialty companies will have an influx of hiring as the country expands resources to protect ground troops and computer networks.

Christopher Drew for The New York Times reports that the 58-to-40 vote clearly gives the Obama administration more room to cut defense spending. The F-22, the world’s most advanced fighter, has been the center of a battle over the administration’s desire to move  more of the Pentagon’s resources away from conventional warfare projects and putting more toward battling insurgencies.

Aircraft maker Boeing Co. (BA) said that Pentagon cuts would claim 1,000 jobs in its defense business, and the company has already been hurt by the commercial slump.

• PowerShares Aerospace and Defense (PPA): up 2.4% year-to-date; Boeing 7.8%

• iShares Dow Jones US Aerospace And Defense (ITA): up 1.4% year-to-date; Boeing 7%

For more stories about defense, visit our aerospace and defense category.

Scott Sacknoff of SPADE Indexes states the following factors make the sector appealing:

• A 5.6% increase in the aerospace budget, much of which will fund the ongoing wars this year
• The launch of rockets by Iran and North Korea are stirring up concerns that something might happen
• Valuations of companies in the sector are at the bottom of the gutter and some companies are showing healthy balance sheets
• A weak dollar makes aerospace more attractive to foreigners
• The satellite and space business remain strong regardless of the economic downturn

This doesn’t mean that it is all gravy for the sector.  As the economy continues to rebound, President Barack Obama and his administration will start reducing spending programs and start paying back some of the nation’s debt.  Unfortunately, defense is one of the largest discretionary items and will probably feel some of this aforementioned wrath.

This has caused aircraft manufacturer, Boeing (BA) to cut its global outlook for aircraft demand and focus on existing orders rather than chasing new orders.  The company reported that over the next 20 years, it anticipates 29,000 new planes to be ordered worldwide, down from an earlier forecast of 29,400, states the Associated Press.

If you do want to grab exposure to the sector, take a look at the following ETFs:

• iShares Dow Jones U.S. Aerospace & Defense Index (ITA): up 7.8% year-to date and above its 200-day moving average; BA is 8%.

• PowerShares Aerospace & Defense (PPA): is up 6.4% and above its 200-day moving average; BA is 7.3%.

For more stories on aerospace and defense, visit our aerospace and defense category.

Kevin Grewal contributed to this article.

A major makeover within the nation’s defense systems would mean Pentagon chief would slash many giant weapons programs, and dissolve the thousands of jobs that go with them, reports Anne Gearan for the Associated Press. The contractors who are protecting their jobs are adding fuel to the fire, says Steve Chiotakis for MarketPlace. Gates’ proposed $534 billion budget for the coming year would face several cuts, and Congress may not approve.

Overall, aerospace and defense equities reflect concerns over demand for air travel and the trajectory of the U.S. defense budget following a wind-down in Iraq. Backlogs, solid balance sheets and smaller enterprises should allow many firms to manage the risks involved. The aerospace and defense group modestly underperformed the broader market over the past five trading days, shedding 1.4% in market value versus a small 0.2% increase in the S&P 500, reports Howard A. Rubel for Barron’s.

• iShares Dow Jones Aerospace & Defense (ITA): down 11.5% year-to-date

• PowerShares Aerospace & Defense (PPA): down 10% year-to-date

Travel demand is down, among other things, and as the world’s second-largest aircraft market, the government has asked that China park unnecessary planes, retire old ones and return aircraft leased from overseas once the contracts are up, according to the Civil Aviation Administration of China (CAAC). Bloomberg says that China is going to do away with jet fuel taxes and refund some facility fees in an effort to help carriers.

Companies like Airbus and Boeing depend on emerging markets like China to offset low demand in the United States and Europe, so this is getting them where it really hurts.

Parallel to the downsizing in China is the delay of the 787 test flight by Boeing (BA) in the United States. The aerospace developer has put the much anticipated test flight of the 787 on hold due tot he recent strike impact and production problems, says Daniel Lovering for Associated Press.

The delay was the latest in a series of setbacks for the 787, which has been touted for its expected high fuel efficiency because of its construction from lightweight carbon fiber composite parts.

• iShares Dow Jones U.S. Aerospace & Defense (ITA): down 45.3% year-to-date; Boeing is 8.4%

According to Merrill Lynch, aerospace and defense has done better under a Democratic rule, especially during a recession, because national security is a good hedge against the broad market, says Pauline Miniter for SmartMoney.

Investors are nervous about President-elect Barack Obama, as many think that while defense spending may not slow, there is going to be a shift of priorities in Washington.

Obama’s administration plans to cut defense spending, which will cut into profits. However, as Joe Biden puts it, it won’t be six months into the new administration when a rogue state will test the new president. There’s still enough uncertaintly in the world that defense companies should remain relevant.

Shareholders in companies such as Raytheon (RTN), Boeing (BA), Lockheed Martin (LMT), and Northrop Grumman (NOC) are left feeling vulnerable as losses ranged from 20% to 50% in the last year.

• iShares Dow Jones U.S. Aerospace & Defense (ITA): down 43.6% year-to-date; Boeing is 8.4%; Raytheon is 7.8%; Lockheed Martin is 7.8%; Northrop is 5.3%

• PowerShares Aerospace and Defense (PPA): down 43.9% year-to-date; Boeing is 8.5%; Lockheed Martin is 7.2%; Raytheon is 5.8%; Northrop is 4.3%

This day is simply to honor those who have served the United States of America during war times and also during peace. Many like to thank those who are among us and who served, as a nod to their addition to our national security.

According to The Wall Street Journal, the NASDAQ will remain open for trading, as stocks and futures will continue to trade, however, the bond market is closed, as it is a Federal holiday.

• iShares Dow Jones Aerospace And Defense (ITA), down 40% year-to-date

It seems an odd time for anyone to strike, with unemployment skyrocketing and the country in the midst of an economic crisis. But the walkout by more than 27,000 commercial jet production workers is in its 38th day and the Boeing’s chief administrator Doug Knight reports that the company is disappointed.

Manuel Valdes for the Associated Press reports that the Machinists Union head, Tom Buffenbarger, reported that talks broke down about the future, but nothing specific was provided.

Issues at stake are job security, pay, retirement, benefits and health care, while provisions such as outsourcing and subcontracting are also relevant.

• PowerShares Aerospace And Defense (PPA): down 37% year-to-date; Boeing is 6.9% (black line)
• iShares Dow Jones Aerospace And Defense (ITA): down 36.5% year-to-date; Boeing is 8.4% (green line)

Reports are that a deal is close, but there is still haggling taking place over a few of the larger components of the package, including how to phase in the cost of the plan without affecting the markets, reports Julie Hirschfeld Davis for the Associated Press.

The core of the plan involves the idea that the government would buy up the bad assets of these shaky financial firms to keep them from going under, and thus avoiding what could be a severe recession.

President Bush last night pushed for quick action, says James Rowley for Bloomberg. Without the plan, Bush said, the U.S. economy would grind to a halt: foreclosures would rise, Wall Street would suffer further losses and millions of Americans could lose their jobs.

Durable goods orders fell by a much more than expected 4.5% in August, mostly on softer demand for transportation equipment and other costly items, reports Glenn Somerville for Reuters. Orders for durable goods, those items made to last three years or more, were expected to fall just 1.6%.

Impacted ETFs:

• Market Vectors Steel (SLX), down 29.5% year to date
• iShares Dow Jones US Aerospace & Defense (ITA), down 22.4% year to date
• Technology Select Sector SPDR (XLK), down 23.4% year to date
• iShares Dow Jones US Technology (IYW), down 21.9% year to date

Oil is stepping back slightly today as investors weigh the supply delays in the Gulf of Mexico against worries about the credit crisis and how it will impact global economy growth. About 66% of oil production and 61% of the natural gas output there remains shut in after the passage of hurricanes, reports Emily Flynn Vencat for the Associated Press.

Affected ETFs:

• iPath S&P GSCI Crude Oil Total Return Index ETN (OIL): up 11.3% year-to-date
• United States Oil Fund (USO): up 12% year-to-date
• PowerShares DB Oil (DBO): up 13.9% year-to-date