The kick-off to summer driving season has begun; so will Memorial Day weekend help set the tone for an ease on gasoline prices? The $140 million exchange traded fund (ETF) US Commodity Gasoline Fund (NYSEArca: UGA) is already up 19% for the year.
Pre-Memorial weekend, the fund was on an uptrend, up 3.2% over the past week. [Gasoline ETF Plummets Along With Oil.] Overall higher gasoline prices have eroded consumer spending, and U.S. consumers have saved less in order to keep up, or they have tapped into savings, reports Reuters. Despite the challenge, AAA reports that more people will be taking off on the road this weekend, and drive 50 miles or more, compared to Memorial Day weekend 2010.
“I checked with our front-line staff and TripTik (AAA’s travel-planning service),” Kate Himmelsbach, spokeswoman for AAA Central Penn, said. “They are noticing an increase in people coming in and picking up tour books and maps.”[Gasoline ETF Plummets 7%.]
Likewise, air travel is on the rise, with AAA projections at about 11% higher than last year at this time, referring to people who will travel by plane. “The economy is continuing to turn around, and people are demonstrating their confidence with an increased willingness to spend,” said AAA spokeswoman Beth Mosher. [Gasoline ETF: Offset Higher Prices at the Pump.]
This could mark the end of the so-called “staycation” that so many U.S. citizens turned to last year.
Tisha Guerrero contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.