The U.S. Global Jets ETF (NYSEArca: JETS) is up half a percent year-to-date, a decent showing when considering the struggles of broader transportation exchange traded funds and the recent public relations missteps by United Continental (NYSE: UAL), one of the largest holdings in JETS.
ETS, the only ETF dedicated to airline equities, is off almost 1% year-to-date and that stems from concerns that President Trump and the Republican-controlled congress are moving slowly on the widely anticipated tax reform effort.
Still, there are encouraging fundamental factors for airlines, including low oil prices. Fuel is the largest input cost for airlines. The improving U.S. economy could encourage more business and leisure travel and airlines are generating impressive amounts of cash.
However, there are concerns that airlines stocks will post tepid first-quarter earnings, potentially dragging the broader industrials sector lower in the process.