First Trust S-Network Electric & Future Vehicle Ecosystem ETF (NASDAQ: CARZ)

에 대한 최신 뉴스 First Trust S-Network Electric & Future Vehicle Ecosystem ETF (NASDAQ:CARZ)

First Trust S-Network Electric & Future Vehicle Ecosystem ETF

First Trust S-Network Future Vehicles & Technology ETF

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The fund will normally invest at least 90% of its net assets (including investment borrowings) in the common stocks and depositary receipts that comprise the index. The index is designed to track the performance of the largest and most liquid companies engaged in the manufacturing of automobiles. The fund is non-diversified.

Apple Inc

Microsoft Corp

Alphabet Inc., Class A

Tesla, Inc.

Samsung Electronics Company Ltd

Taiwan Semiconductor - Adr

Qualcomm Inc.

Nvidia Corp.

Advanced Micro Devices Inc.

Texas Instruments Inc

Asia

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First Trust Exchange-Traded Fund VIII First Trust Active Global Quality Income ETF

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대만 반도체 제조(TSMC)(NYSE:TSM)와 관련된 인기 있는 차익 거래(arbitrage trade)는 자사의 대만 주식 대비 미국 주식 프리미엄이 15년 최고치에 도달하면서 예상치 못한 어려움을 야기하고 있다. 사건의 전말 (What Happened): 대만 주식에 대한 TSMC의 미국 증권예탁증서(ADR)의 프리미엄은 이번 분기에 22%로 급등했는데, 이는 2009년 이후 가장 높은 평균치이라고 블룸버그가 월요일에 보도했다. 이러한 급등은 인공 지능(AI)에 대한 미국의 지속적인 열광에 기인한다.

미국 주식 프리미엄이 15년 최고치를 기록하면서 TSMC 차익 거래가 어려움에 직면

Media

AMZN

애플, 엔비디아는 AI 수요 급증에 대만의 TSMC의 고급 칩으로 미래 확보

Editor&#8217;s Note: The first paragraph has been amended to correct TSMC&#8217;s stance
Monday, Taiwan Semiconductor Manufacturing Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TSM#NYSE">TSM</a>) snubbed the Wall Street journal report that claims its plans for <a href="https://www.benzinga.com/markets/equities/24/09/40973148/tsmc-and-samsung-explore-100b-chip-megafactories-in-uae-amid-ai-boom-and-global-expansion-plans-" target="_blank" rel="noreferrer noopener">new foreign investments</a> are backed by United Arab Emirates (UAE) subsidies.
Recent reports indicated the Taiwanese contract chipmaker intends to collaborate with Samsung Electronics (OTC:<a class="ticker" href="https://www.benzinga.com/stock/SSNLF#OTC">SSNLF</a>) for a project in the UAE. The initiative entails investments exceeding $100 billion, the Taipei Times <a href="https://www.taipeitimes.com/News/biz/archives/2024/09/23/2003824231" target="_blank" rel="noreferrer noopener">reports</a>.
Taiwan Semiconductor executives reportedly visited the UAE and discussed a plant with advanced facilities akin to Taiwan.
Taiwan Semiconductor remains focused on its <a href="https://www.benzinga.com/government/24/09/40940463/whats-going-on-with-taiwan-semiconductor-stock-on-thursday" target="_blank" rel="noreferrer noopener">U.S. expansion</a>. It promoted Rose Castanares, executive vice president of the Arizona unit, as president last week. The company is a key supplier to Nvidia Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) and Apple Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>). The company also inked at least two smartphone chip deals. One agreement is with Apple for the iPhone and the other is with Alphabet Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOGL#NASDAQ">GOOGL</a>) for the Google Pixel 10 and Pixel 11.
Taiwan Semiconductor is building two fabs in Arizona involving the 4nm, 3nm, and 2nm processes. It also targets a third fab in Arizona, leveraging the 2nm process.&nbsp;
The U.S. offered the chipmaker a $6.6 billion federal grant and $5 billion in loans. Last week, the U.S. Federal Reserve slashed its benchmark interest rate by 50 basis points. Setting the interest rate at 4.75%-5% to spur growth can be a tailwind for capital-intensive semiconductor companies.
Taiwan Semiconductor stock has been up 102% in the last 12 months, being the critical contract chipmaker for AI chips. Investors can gain exposure to Taiwan Semiconductor through ProShares Nanotechnology ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TINY#NYSE">TINY</a>) and First Trust S-Network Electric &amp; Future Vehicle Ecosystem ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CARZ#NASDAQ">CARZ</a>).
Price Action: Taiwan Semiconductor stock is up 0.35% at $174.69 premarket at last check Monday.
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GOOGL

SSNLF

TINY

Taiwan Semiconductor Denies UAE Investment Rumors: Report (UPDATED)

A possible strike by thousands of dockworkers at <a href="https://www.benzinga.com/government/24/09/40713418/retailers-plea-for-deal-us-ports-union-start-two-day-talk-in-effort-to-prevent-disruptive-strike">East and Gulf coast ports</a> in October could result in major disruptions in the supply chain of goods coming in and out of the U.S., according to an export on container trade.
The International Longshoremen's Association (ILA), representing more than 85,000 dockworkers, may go on strike on Oct. 1 as the union&#8217;s contract expires on Sept. 30 and negotiations between the ILA and U.S. Maritime Alliance of terminal operators show signs of breaking down, said Christian Roeloffs, CEO of online container leasing platform Container xChange.
&#8220;A strike now appears increasingly likely, threatening to disrupt nearly half of the nation&#8217;s ocean trade,&#8221; he said on Tuesday.
&#8220;The uncertainty is compounded by the fact that the duration of these strikes is unclear — it could be resolved within weeks or drag on for months, as seen with the West Coast strike last year.
&#8220;September is traditionally one of the busiest months for U.S. containerized imports, driven by the peak shipping season as businesses prepare for the holiday rush.&#8221;
Read Also: <a href="https://www.benzinga.com/news/global/24/08/40451543/transatlantic-container-shipping-volumes-rise-as-possible-strike-at-u-s-ports-hovers">Transatlantic Container Shipping Volumes Rise As Possible Strike At U.S. Ports Hovers</a>
But it isn&#8217;t just a strike that threatens to disrupt the shipment of goods for the retail, automotive and other sectors, he said.
&#8220;This year presents an unprecedented combination of challenges that could heavily impact supply chains. Potential labor strikes, natural disasters, and tariff uncertainties are converging, creating a highly volatile environment for global trade,&#8221; he said. 
&#8220;This also led to the pulling forward of orders by retailers, which led to strong inventories in the U.S.&#8221;
A strike could also cause havoc for container leasing and trading companies by causing major delays, port congestion and rerouted cargo, Roeloffs said.
"Companies should anticipate short-term spikes in demand for leased containers as retailers rush to secure goods ahead of potential disruptions, particularly for seasonal inventory and industrial shipments," he said.
&#8220;While the threat of strikes looms large, it's important to note that U.S. inventories are currently strong due to the pulling forward of orders earlier this year to avoid existing disruptions. 
The retail, automotive and semiconductor industries, all of which could be impacted by a port strike, saw gains and losses into Tuesday&#8217;s mid-day trading.
<h1 class="wp-block-heading">Retail</h1>
<ul>
<li>Walmart Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/WMT#NYSE">WMT</a>) fell 1.18% to $79.61</li>
<li>Target Corporation (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TGT#NYSE">TGT</a>) slipped 0.26% to $152.45</li>
<li>Home Depot, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/HD#NYSE">HD</a>) gained 0.89% to $385.42</li>
</ul>
<h1 class="wp-block-heading">Automotive</h1>
<ul>
<li>Ford Motor Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/F#NYSE">F</a>) gained 1.30% to $10.94</li>
<li>General Motors Co (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GM#NYSE">GM</a>) picked up 1.59% to $47.62</li>
<li>Stellantis N.V. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/STLA#NYSE">STLA</a>) slipped 0.18% to $15.16</li>
</ul>
<h1 class="wp-block-heading">Semiconductor</h1>
<ul>
<li>Taiwan Semiconductor Manufacturing Co. Ltd. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TSM#NYSE">TSM</a>) fell 0.43% to $168.35</li>
<li>Broadcom Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) declined 0.87% to $162.59</li>
<li>Qualcomm Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QCOM#NASDAQ">QCOM</a>) rose 1.13% to $68.50</li>
</ul>
<h1 class="wp-block-heading">Indexes that follow the retail and automotive sectors trended upward</h1>
<ul>
<li>Dow Jones Transportation Average, which is tracked by the iShares Transportation Average ETF (BATS:<a class="ticker" href="https://www.benzinga.com/stock/IYT#BATS">IYT</a>), rose 1.2% to 16,032.91 points</li>
<li>S&amp;P Retail Select Industry Index, which is tracked by the SPDR S&amp;P Retail ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XRT#NYSE">XRT</a>), gained 1.4% to 10,375.45 points</li>
<li>S&amp;P 500 Automobiles &amp; Components Index&nbsp;rose 2.7% to 130.02 points. There is no exchanmge-traded fund that closely follows this index, but First Trust S-Network Future Vehicles &amp; Tech ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CARZ#NASDAQ">CARZ</a>) provides broad exposure to global automobile manufacturers and related companies, including those in the S&amp;P 500 Automobiles &amp; Components Index.</li>
</ul>
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<li><a href="https://www.benzinga.com/news/global/24/08/40497103/strikes-at-us-ports-canadas-railways-may-cause-container-freight-rate-volatility">Strikes At US Ports, Canada&#8217;s Railways May Cause Container Freight Rate Volatility</a></li>
</ul>
Photo: Shutterstock

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AVGO

iShares Dow Jones Transportation Average Index Fund

STLA

US Port Strike In October Could Lead To Major Supply-Chain Disruptions, Says Container Trade Expert

The popular arbitrage trade involving Taiwan Semiconductor Manufacturing Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TSM#NYSE">TSM</a>) is causing unexpected pain as the U.S. stock premium over its Taiwanese counterpart reaches a 15-year high.
What Happened: The premium of TSMC&#8217;s American depositary receipts over its Taiwan stock has surged to 22% this quarter, the highest average since 2009, Bloomberg <a href="https://www.bloomberg.com/news/articles/2024-06-17/a-popular-arbitrage-trade-backfires-as-tsmc-frenzy-grows-in-us">reported</a> on Monday. This surge is attributed to the U.S.&#8217;s growing enthusiasm for artificial intelligence.
Despite a 66% increase in ADRs and a 53% rise in Taipei shares this year, both are still trading below their 2021 valuation highs. The ADRs&#8217; accessibility to foreign investors and their inclusion in various indices and exchange-traded products have contributed to their outperformance.
Arbitrage involves simultaneously buying and selling the same or similar asset in different markets to profit from minor price differences. It exploits short-term variations in the price of identical or similar financial instruments across different markets or forms.
"It's supply/demand dynamics," said Brian Freitas, founder of research firm Periscope Analytics. "Not all foreign investors can hold the Taiwan stock so they just prefer owning the ADRs. Plus there are some indices which only reference the ADR, so ETFs then basically buy up the U.S. shares."
ADRs have historically traded at a premium due to their fungibility, unlike the Taiwan shares, which require special regulatory approval for conversion into the U.S. equivalent. The ADRs are also heavily owned by fund managers, making it challenging for them to increase their position further.
Jon Withaar, head of Asia special situations at Pictet Asset Management, noted that the AI sector remains strong, with NVIDIA Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) alone valued at over $3 trillion. The ADRs&#8217; premium over the local stock has risen to an average of almost 17% this quarter, indicating a continued AI boom.
"The AI boom is not over," Withaar said. "I'm happy to wait for a crescendo widening and perhaps even panic unwinding."
See Also: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/06/39345194/apple-nvidia-are-the-most-overbought-stocks-on-wall-street-amid-ai-frenzy-here-are-?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Apple, Nvidia Are The Most Overbought Stocks On Wall Street Amid AI Frenzy: Here Are Other Stocks With Potential For Pullback</a>
Why It Matters: TSMC&#8217;s ADRs have been in high demand due to the global AI frenzy. Companies like Apple Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>), Qualcomm Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QCOM#NASDAQ">QCOM</a>), Nvidia, and Advanced Micro Devices, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMD#NASDAQ">AMD</a>) have almost fully booked TSMC&#8217;s 3nm <a href="https://www.benzinga.com/news/24/06/39310821/apple-nvidia-secure-future-with-taiwan-semis-advanced-chips-as-ai-demand-soars">chip production process until 2026</a>, reflecting the rapid evolution of AI technology.
Meanwhile, TSMC&#8217;s European subsidiary, European Semiconductor Manufacturing Co, plans to <a href="https://www.benzinga.com/news/24/06/39288408/taiwan-semiconductors-european-subsidiary-to-hire-2k-employees-in-semiconductor-push">hire nearly 2,000 employees</a> from Germany and other European countries. This move comes amid a trend of job cuts in the tech sector, as companies reallocate resources to meet the demands of advancing AI technology.
Taiwan Semiconductor stock gained over 64% in the last 12 months. Investors can gain exposure to the semiconductor sector via First Trust Exchange-Traded Fund VIII First Trust Active Global Quality Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AGQI#NYSE">AGQI</a>) and First Trust S-Network Electric &amp; Future Vehicle Ecosystem ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CARZ#NASDAQ">CARZ</a>)
Price Action: Taiwan Semiconductor Manufacturing Co. Ltd.&#8217;s U.S.-listed stock closed at $172.51 on Friday, down 0.23%. Year to date, it has increased by 69.91%, and over the past year, it has risen by 64.97%. Over the past five years, the U.S.-listed stock has surged by 355.89%. 
In comparison, TSMC&#8217;s Taipei-listed stock has increased by 55.31% year to date, 57.98% over the past year, and 270.22% over the past five years, according to the <a href="https://pro.benzinga.com/dashboard">data from Benzinga Pro</a>.
Read Next: <a href="https://www.benzinga.com/analyst-ratings/analyst-color/24/06/39328409/hedge-fund-manager-says-trumps-radical-tax-plan-is-hyperbole-useful-to-kick-the-hor?itm_source=parsely-api" target="_blank" rel="noreferrer noopener">Hedge Fund Manager Says Trump&#8217;s Radical Tax Plan Is &#8216;Hyperbole…Useful To Kick The Hornet&#8217;s Nest&#8217;: &#8216;Not Going To Be A Plan That Works&#8217;</a>
Image Via Shutterstock 
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Taiwan Semiconductor Arbitrage Trade Faces Challenges As US Stock Premium Hits 15-Year High: 'AI Boom Is Not Over'

Apple Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>), Qualcomm Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QCOM#NASDAQ">QCOM</a>), Nvidia Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>), and Advanced Micro Devices, Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMD#NASDAQ">AMD</a>) have almost fully booked Taiwan Semiconductor Manufacturing Company Ltd's (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TSM#NYSE">TSM</a>) 3nm chip production process until 2026, reflecting the artificial intelligence frenzy.
This demand spike reflects the rapid evolution of AI technology, pushing TSMC to innovate further in advanced manufacturing, TechNode <a target="_blank" href="https://technode.com/2024/06/12/apple-qualcomm-nvidia-amd-fully-book-tsmcs-3nm-capacity-until-2026/" rel="noreferrer noopener">reports</a>.
N3E, which started mass production last quarter, targets AI accelerators, high-end smartphones, and data centers. N3P, scheduled for mass production later this year, will cater to mobile devices and consumer electronics. It will likely be the standard by 2026.
To accommodate the growing demand, TSMC plans to convert some 5nm equipment to enhance 3nm production capacity, potentially increasing 3nm wafer production to between 120,000 and 180,000 units monthly. TSMC stock is trading higher on Thursday.
The contract chipmaker remains engaged in expanding its <a target="_blank" href="https://www.benzinga.com/news/24/06/39293929/whats-going-on-with-nvidia-amd-stocks-on-wednesday" rel="noreferrer noopener">geographical presence beyond</a> Taiwan. Recent reports indicated that TSMC is looking to recruit 2,000 employees in Europe, coinciding with its plans to construct a Dresden wafer fab.
Also, TSMC has significantly <a target="_blank" href="https://www.benzinga.com/government/24/06/39267332/taiwan-semi-outperforms-chinas-top-chipmaker-amid-tech-challenges" rel="noreferrer noopener">beaten leading Chinese</a> chipmaker&nbsp;Semiconductor Manufacturing International Corp (SMIC), bagging a market share of 62% in the first quarter. It clocked a 30% sales growth in May, reaching $7.1 billion, as the intense demand for AI refuses to fizzle out anytime soon.
<figure class="wp-block-image size-full"><img loading="lazy" decoding="async" width="750" height="650" src="https://editorial-assets.benzinga.com/wp-content/uploads/2024/06/13044941/newplot-25.png" alt="" class="wp-image-386123" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2024/06/13044941/newplot-25.png 750w,https://editorial-assets.benzinga.com/wp-content/uploads/2024/06/13044941/newplot-25-300x260.png 300w" sizes="(max-width: 750px) 100vw, 750px" /></figure>
Taiwan Semiconductor stock gained 62% in the last 12 months. Investors can gain exposure to the semiconductor sector via First Trust Exchange-Traded Fund VIII First Trust Active Global Quality Income ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/AGQI#NYSE">AGQI</a>) and First Trust S-Network Electric &amp; Future Vehicle Ecosystem ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CARZ#NASDAQ">CARZ</a>).
Price Action: TSM shares were trading higher by 0.99% to $174.70 premarket at the last check on Thursday.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
Photo by Ivan Marc via Shutterstock

Apple, Nvidia Secure Future with Taiwan Semi's Advanced Chips as AI Demand Soars

Politics

General

Automakers Commit To Spend $250B On Electric Cars In U.S.

Electric vehicle producer Tesla (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/tsla#NASDAQ">TSLA</a>) reports first-quarter results Wednesday after the close, and while those numbers are expected to be weak because of the coronavirus, analysts remain mostly enthusiastic about the company&#39;s long-term prospects.
Wall Street is expecting Tesla to post a loss of $1.22 a share for the first three months of 2020, but some analysts believe that number will be beaten&nbsp;and that with an ensuing rally, Elon Musk&#39;s company could qualify for entry <a href="https://www.cnbc.com/2020/04/28/tesla-is-poised-to-beat-earnings-and-possibly-qualify-for-sp-500-inclusion-barclays-says.html">into the S&amp;P 500</a>.
Assuming that occurs, a rally could be further fueled by index funds, exchange traded funds and active managers that benchmark to that index.
Analysts are forecasting deliveries <a href="https://www.benzinga.com/analyst-ratings/analyst-color/20/04/15883850/tesla-q1-earnings-preview-analysts-convinced-of-long-term-potential-ahead-of-the-pr">of 400,000 this year</a> and that guidance could be weak, comparatively speaking, due to COVID-19. Still, with the recent batch of ratings on Tesla being mostly bullish, it could pay to consider the following ETFs.
ARK Autonomous Technology &amp; Robotics ETF (ARKQ)
One of the kings of the Tesla ETF fray, the ARK Autonomous Technology &amp; Robotics ETF (CBOE: ARKQ) allocates almost 13% of its weight to the stock. That&#39;s been enough to send ARKQ higher by 3.23% year-to-date, which sounds modest, but that showing is downright impressive relative to the Nasdaq-100 Index and the S&amp;P 500.
Few, if any, active management teams are as bullish on or sink with Tesla as ARK.&nbsp;The. team recently addressed total cost of ownership&nbsp;for electric vehicles, which is becoming a relevant point <a href="https://www.benzinga.com/analyst-ratings/analyst-color/20/04/15891645/an-oil-etf-for-the-daring">with oil prices slumping.</a>
&ldquo;According to ARK&rsquo;s research, over a three-year period the Long-Range Tesla Model 3 is already less expensive to own than a Toyota Camry, and the low-end Model 3 less expensive than a Ford Focus,&rdquo; <a href="https://ark-funds.com/arkq">according to ARK</a>.
&ldquo;The TCO is much more sensitive to a vehicle&rsquo;s residual value than to gas prices. In our view, the right question is how low the prices of used gas-powered cars will go as the market transitions first to electric vehicles, and then to autonomous electric vehicles.&rdquo;
First Trust NASDAQ Global Auto Index Fund (CARZ)
Somewhat quietly, the oft-overlooked First Trust NASDAQ Global Auto Index Fund (NASDAQ: <a class="ticker" href="https://www.benzinga.com/stock/carz#NASDAQ">CARZ</a>) lays claim to having the largest Tesla exposure &mdash; and the competition isn&#39;t all that close. Tesla accounts for 23.53% of the CARZ, an advantage of roughly 400 basis points over the ETF with the second-largest weight to the stock.
CARZ tracks the NASDAQ OMX Global Auto Index. While the Tesla exposure is impressive, it hasn&#39;t been enough to prevent the ETF being burned by lagging&nbsp;traditional automotive holdings, as highlighted by the fund&#39;s 19.16% year-to-date decline.
Global X Lithium &amp; Battery Tech ETF (LIT)
The Global X Lithium &amp; Battery Tech ETF (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/lit#NYSE">LIT</a>) allocates 14.35% of its weight to Tesla, a total surpassed by just three other ETFs, including the aforementioned ARKQ and CARZ. Interestingly, Tesla isn&#39;t LIT&#39;s largest holding. That title is occupied by Albermale (NYSE: <a class="ticker" href="https://www.benzinga.com/stock/alb#NYSE">ALB</a>). Combined, those two stocks command about one-third of LIT&#39;s weight.
By the end of 2021, the lithium market will return to balance as demand growth resumes from increased electric vehicle adoption and other batteries and eats up new supply,&rdquo; <a href="https://www.morningstar.com/articles/979397/look-to-lithiums-bright-long-term-future">writes Morningstar analyst</a> Seth Goldstein.
Photo courtesy of Tesla.&nbsp;

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Economics

US Commerce Secretary Ross Says Section 232 Measures On Cars Will Be Ready When Needed

Rumors

President Trump on Call with Mexico's Nieto Says He Will Call Canadian Prime Minister Shortly, Says the Easiest Action Would be to Put Tariffs on Cars, According to Reuters

Major Auto Trade Group To Tell Trump Admin That A 25% Tariff On Imported Vehicles Would Cost U.S. Consumers $45B In Higher Vehicle Costs, U.S. Buyers Of Imported Vehicles Would Face An Avg. Price Increase Of $5,800

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SenesTech Inc (NASDAQ: <a class="ticker" href="/stock/snes#NASDAQ">SNES</a>) stock was trading higher by more than 10 percent early Tuesday morning after trading higher at one point Monday by nearly 300 percent. The nano-cap developer of pest control said the California state government approved the company&#39;s ContraPest for user in the state.
Kohl&#39;s Corporation (NYSE: <a class="ticker" href="/stock/kss#NYSE">KSS</a>) gained more than 5 percent after the department store reported its <a href="https://www.benzinga.com/pressreleases/18/05/b11754599/kohls-corporation-reports-financial-results">first-quarter results.</a> The company said it earned 64 cents per share in the first quarter on revenue of $4.208 billion versus expectations of 50 cents per share and $3.95 billion. The company also narrowed its 2018 EPS guidance from a range of $4.95-$5.45 to a new range of $5.05-$5.45.
1st Trust NASDAQ Global Auto ETF (NASDAQ: <a class="ticker" href="/stock/carz#NASDAQ">CARZ</a>) could see increased volatility throughout Tuesday&#39;s trading session in reaction to potentially favorable trade relations. China&#39;s government <a href="https://www.bloomberg.com/news/articles/2018-05-22/china-is-said-to-cut-car-import-duty-in-boost-for-lexus-bmw">agreed to lower</a> the tariff rate on American cars and parts from 25 percent to 15 percent.
Precipio Inc (NASDAQ: <a class="ticker" href="/stock/prpo#NASDAQ">PRPO</a>) gained 50 percent early Tuesday morning after the nano-cap specialty diagnostics company said it&nbsp;<a href="https://www.benzinga.com/pressreleases/18/05/g11754876/potential-sequential-revenue-run-rate-growth-of-30-over-q1-based-on-pr">saw an acceleration of sales</a> in its Pathology services in April. The company now expects to see a sequential double digit quarterly sales growth.
Pure Storage Inc (NYSE: <a class="ticker" href="/stock/pstg#NYSE">PSTG</a>) was trading lower by more than 7 percent despite reporting a first-quarter earnings beat and an in-line guidance announcement. William Blair analysts commented in a report the company&#39;s solid print was unfortunately &quot;dwarfed by high expectations.&quot;
<il>Related Links:</il>
<a href="https://www.benzinga.com/news/18/05/11755265/25-stocks-moving-in-tuesdays-pre-market-session">25 Stocks Moving In Tuesday&#39;s Pre-Market Session</a>
<a href="https://www.benzinga.com/news/18/05/11754867/a-peek-into-the-markets-us-stock-futures-up-crude-oil-rises">A Peek Into The Markets: US Stock Futures Up, Crude Oil Rises</a>

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PSTG

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Benzinga Pro's 5 Stocks To Watch Today

After registering the first annual sales decline since the financial crisis last year, the auto industry has been struggling with weak sales this year. This is especially true as car sales dropped 2% year over year to an annualized 17.08 million units in February, after rising 1.2% in January. The weak performance came on the heels of lower discounts.
	Of the six major American and Japanese automakers, Ford Motor F and General Motors GM posted the biggest sales decline of 7% each, followed by declines of 5% for Honda HMC, 4% for Nissan Motor NSANY and 1% for Fiat Chrysler FCAU. Toyota TM&nbsp;saw an increase of 4.5% in its sales last month. General Motors and Fiat Chrysler have a Zacks Rank #2 (Buy), while the other four automakers have a Zacks Rank #3 (Hold).
	The only pure play auto ETF is the First Trust NASDAQ Global Auto ETF CARZ. It offers global exposure to the 34 auto stocks by tracking the NASDAQ OMX Global Auto Index. It is a large-cap centric fund and is highly concentrated on the top five firms &ndash; Honda, Toyota, Daimler, General Motors and Ford &ndash; with a combined 38.6% share while other firms hold no more than 4.38% of assets. In terms of country exposure, Japan takes the top spot at 25.9% while the United States and Germany round off the next two spots with at least 19% share each. CARZ has a lower level of $20.8 million in AUM and trades in a small average daily trading volume of about 5,000 shares. The product charges 70 bps in fees per year and has a Zacks ETF Rank #3 with a High risk outlook, suggesting some room for upside.
	What Lies Ahead?
	The year 2018 seems to be a challenging one for automakers, with many market experts expecting auto sales to fall below $17 million. A strong economy, low unemployment, increasing consumer confidence, higher spending, fuel-efficient and technologically enriched vehicles, and low financing rates and gasoline prices will continue to fuel the industry.
	Strong earnings expectation is an added boost as the sector is expected to return to growth. For the full year, earnings for the sector is expected to growth 0.8% and revenues are expected to rise 2.7% versus a decline of 2.2% and 1.6%, respectively, last year.
	The tax reform will provide a lift to U.S. sales but at the same time also encourage rate hikes, which will make financing of new vehicles expensive. Trump&#39;s intention of imposing heavy tariffs on imported steel and aluminum would be a big blow to the industry as it would increase the cost of auto production. Notably, the auto sector accounted for 26% of demand for steel in the United States in 2017, behind the construction industry, at 40% of demand in 2017, according to data provider Statista.
	Further, the shift in consumers, preference from passenger cars to more profitable pickup trucks and SUVs, as well as longer usage of vehicles will continue to be a drag on sales. The average age of vehicles on the road has climbed to <a href="http://abcnews.go.com/Business/wireStory/us-auto-sales-expected-drop-2017-remain-strong-52112498">11.6 years</a> from 8.8 years in 1998.
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NSANY

Should You Steer Clear Of Auto ETFs And Stocks?

From his campaign days, Trump has indicated that he wants to renegotiate the North American Free Trade Agreement (NAFTA) or totally remove it. The agreement had tied up the U.S., Canada and Mexico for more than two decades. The deal permitted manufacturers and farmers to do seamless business.
Now, this agreement may be threatened as Trump intends to bring jobs offshored to countries like Mexico back to America.
Against these circumstances, we highlight the ETF areas that should be closely watched.
<h3>
	Mexico and Canada</h3>
Analysts from Goldman Sachs noted that &quot;exports to Mexico account for just 1% of U.S. GDP. Similarly, revenues to Mexico and Latin America total just 3% of S&amp;P 500 sales.&quot; While it makes up just a fraction of the U.S. economy, <a href="https://finance.yahoo.com/news/happens-trump-pulls-us-nafta-212235421.html">NAFTA specifically represents</a> substantial portions of Mexico and Canada&#39;s GDP.
&quot;Trade has jumped sharply between the United States and Mexico since NAFTA&#39;s signing, from roughly $290 billion in 1993 to more than $1.1 trillion in 2016. That compares to the $650 billion in bilateral trade the U.S. did with China last year,&quot; as per a note issued by Deutsche Bank analysts.
So, the adverse impact on Canadian and Mexican currency is expected. Guggenheim CurrencyShares Canadian Dollar Trust ETF FXC may be hit hard. U.S. foreign direct investment in Mexico jumped from $15 billion to more than $100 billion from 1993 to 2016. Needless to say, these issues do not go well with country ETFs like&nbsp;iShares MSCI Mexico Capped&nbsp;EWW and&nbsp;iShares MSCI Canada&nbsp;ETF&nbsp;EWC.
<h3>
	Auto</h3>
A huge portion of U.S. trade deficit with Mexico is from the auto sector. Goldman Sachs also indicated that the S&amp;P 500 auto&nbsp;component companies have returned about 52% and electronic equipment firms&nbsp;have offered investors 51% returns compared with 36% provided by the S&amp;P 500 on average. Now, these auto stocks may fall flat if the United States walks out of NAFTA. So, First Trust NASDAQ Global Auto ETF CARZ will be in focus.
<h3>
	Timber</h3>
Already, U.S. President Trump announced plans to slam a tariff of up to 24% on imports from the Canadian softwood lumber industry. The Trump administration indicated that it would levy countervailing duties ranging from&nbsp;<a href="https://www.bloomberg.com/politics/articles/2017-04-24/trump-said-to-plan-20-tariff-on-canadian-softwood-lumber-j1wq4tyg">3% to 24.1%</a>&nbsp;on Canadian lumber producers, as reported by&nbsp;<a href="https://www.bloomberg.com/politics/articles/2017-04-24/trump-said-to-plan-20-tariff-on-canadian-softwood-lumber-j1wq4tyg">Bloomberg</a>.
Along with&nbsp;<a href="http://www.cnbc.com/2017/04/24/trumps-timber-tariff-will-have-a-big-impact-on-lumber-futures-market-housing-stocks.html">several traders</a>, we also believe the action, if it materializes, may lead lumber prices to scale up as lumber imports from Canada will now become costlier. And domestic lumber companies may also be able to charge some price premium in the face of lesser foreign competition. However, Canada has filed a wide-ranging case with the World Trade Organization -- over those and other tariffs that the United States has levied. iShares S&amp;P Global Timber &amp; Forestry Index Fund WOOD thus comes under focus.
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Futures

Currency ETFs

Forex

iShares S&P Global Timber & Forestry Index Fund

WOOD

ETFs To Watch If The U.S. Pulls Out Of NAFTA

The ETF industry comprises a flurry of innovative products. One such product is KraneShares Electric Vehicles and Future Mobility ETF KARS. Let&#39;s delve a little deeper:
Inside KARS
KARS looks to track the performance of Solactive Electric Vehicles and Future Mobility Index. The index takes care of global companies that are into the production of electric vehicles and/or their components, or are engaged in other initiatives that may promote the future of mobility.
The index &quot;includes issuers that are into the electric vehicle production, autonomous driving, shared mobility, lithium and/or copper production, lithium-ion/lead acid batteries, hydrogen fuel cell manufacturing and/or <a href="https://kraneshares.com/kars/">electric infrastructure businesses</a>&quot;, as per the issuer.
The index&#39;s constituents include NVIDIA, Baidu, Daimler, Tesla, Samsung SDI, BYD, and Galaxy Resource. No stock accounts for more than 3.88% of the fund with NVIDIA being the top holding. The fund charges 69 bps in fees.
How Does it Fit in a Portfolio?
&nbsp;Electric powered vehicles are gaining immense popularity, thanks to technological development, improving cost economics, government support and increasing acceptance of the powertrain by customers as well as automakers. &nbsp;Per Bloomberg New Energy Finance report issued in 2017, &quot;54% of new car sales and 33% of the global car fleet are projected to be electric by 2040,&quot; as quoted by the issuer.
Countries like China and United Kingdom are focusing on promoting electric cars. China is trying hard to foray into the electric car market as it is working to end sales of fossil-fuel-powered vehicles. Mainland China is currently the world&#39;s largest electric vehicle market, per KraneShares. This is why the index takes into accounts companies that are listed on the Shanghai and Shenzhen Stock Exchanges (A-shares).
KraneShares noted that Chinese companies like Baidu are developing artificial intelligence essential for autonomous &nbsp;driving, and BYD is a world leader in electric vehicles and electric battery manufacturing. KraneShares&#39; CEO went on to say &quot;global companies within the future mobility ecosystem such as Tesla, &nbsp;NVIDIA, and Albemarle Corporation are also capitalizing on strong demand from Chinese and global consumers.&quot;
Competition
The fund should see access ahead as it targets one of the fast-evolving areas of the global investment world. However, there are a few ETFs that can act as peers to this newly-launched product.
Of these, Global X Lithium &amp; Battery Tech ETF LIT comes first.With lithium batteries being used in the electric car making, the fund could pose a threat to KARS (read: <a href="https://www.zacks.com/stock/news/275694/inside-the-surge-in-lithium-etf">Inside The Surge in Lithium ETF</a>).
Then there is the traditional car ETF, First Trust NASDAQ Global Auto Index Fund CARZ. The underlying index of the fund &ndash; the NASDAQ OMX Global Auto Index &ndash; is designed to track the performance of the largest and most liquid companies engaged in manufacturing of automobiles (read: <a href="https://www.zacks.com/stock/news/287843/auto-sales-hit-the-brakes-in-2017-etfs-amp-stocks-in-focus">Auto Sales Hit the Brakes in 2017: ETFs &amp; Stocks in Focus</a>).
The fund charges 70 bps in fees. However, there is a difference between CARZ and KARS. While CARZ mainly focuses on automobile companies, KARS takes care of semiconductor stocks as well as the companies that are related to the future of mobility.
&nbsp;
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BIDU

An ETF For Early Exposure To The Electric Car Market

Auto sales have declined between 1 and 2 percent off 2016&rsquo;s all-time highs and market experts expect no recovery.
Although still considering autos a &ldquo;core&rdquo; business line, Morgan Stanley is cautious on U.S. companies and discourages heavy exposure to both manufacturers and suppliers.
<h3>
	The Rating</h3>
Analyst <a href="https://www.tipranks.com/analysts/adam-jonas">Adam Jonas</a> maintained Overweight ratings on Fiat Chrysler Automobiles NV (NYSE: <a class="ticker" href="/stock/fcau#NYSE">FCAU</a>) and Goodyear Tire &amp; Rubber Co (NASDAQ: <a class="ticker" href="/stock/gt#NASDAQ">GT</a>); Equal-weight ratings on General Motors Company (NYSE: <a class="ticker" href="/stock/gm#NYSE">GM</a>) and Tesla Inc (NASDAQ: <a class="ticker" href="/stock/tsla#NASDAQ">TSLA</a>); and Underweight ratings on Ford Motor Company (NYSE: <a class="ticker" href="/stock/f#NYSE">F</a>), Hertz Global Holdings, Inc (NYSE: <a class="ticker" href="/stock/htz#NYSE">HTZ</a>) and Avis Budget Group Inc. (NASDAQ: <a class="ticker" href="/stock/car#NASDAQ">CAR</a>).
<h3>
	The Thesis</h3>
&ldquo;We expect 2018 to feature an unprecedented extension of auto credit as well as unprecedented levels of strategic activity,&rdquo; Jonas said in a Tuesday note. &ldquo;We anticipate returns to be highly idiosyncratic in 2018.&rdquo; (See Jonas&#39; track record <a href="https://www.tipranks.com/analysts/adam-jonas">here</a>.)&nbsp;
Jonas gave six reasons for his take on the sector:&nbsp;&nbsp;
<ul>
<li>
		First, Jonas expects the <a href="https://www.benzinga.com/analyst-ratings/analyst-color/17/03/9198234/meet-the-companies-most-exposed-to-subprime-auto-risk">financing </a>and leasing momentum of 2017 to extend into 2018, buoying the industry to a 5-percent sales decline and, compounded with a potential increase in mix, supporting industry profitability.</li>
<li>
		Second, the accelerated <a href="https://www.benzinga.com/analyst-ratings/analyst-color/17/10/10144613/tesla-delays-gm-ramps-up-whats-the-new-timeline-for-aut">evolution </a>of vehicles places old and new models alike at risk of near-term devaluation and incentivizes consumers to lease rather than buy. The trend may stunt OEM sales and prompt a rise in product price.</li>
<li>
		Third, Jonas expects louder &ldquo;noise&rdquo; surrounding autonomous vehicles in 2018 as OEMs announce competitive strategies and update timelines.</li>
<li>
		Fourth, 2018 could see 2017&rsquo;s theme of spinoffs, buyouts, initial public offerings and general restructurings &ldquo;amplify materially&rdquo; and shake up asset portfolios.</li>
<li>
		&ldquo;We expect carve-outs to potentially have a bigger impact on stock prices than even the auto credit/cycle,&rdquo; Jonas said.&nbsp;</li>
<li>
		Fifth, Jonas anticipates a successful Model 3 ramp inspiring material change in auto investor theses and forming a chasm in the electric vehicle field between Tesla and its competitors.</li>
<li>
		Sixth, the transition toward electric and autonomous systems is seen to incentivize OEMs to return to vertical integration models, which shifts outsourcing business from suppliers and puts those exposed to the old auto industry at risk of obviation.</li>
</ul>
Considering these factors, Jonas named Goodyear his top pick for its exposure to the &ldquo;miles economy&rdquo; and replacement demand. He&rsquo;s &ldquo;warming up&rdquo; to Ford based on the potential for its strategy reveal, while he expects Tesla volatility based on destressing of its balance sheet.
Hertz and Avis are seen as having a 40- and 60-percent downside risk, respectively, amid rising competition from ride sharing services and vehicle cost inflation.
<h3>
	Price Action</h3>
At the time of publication, the auto-specific First Trust Exchange-Traded Fund II (NASDAQ: <a class="ticker" href="/stock/carz#NASDAQ">CARZ</a>) was trading at $42.15.
Related Links: 
	<a href="https://www.benzinga.com/news/17/12/10861597/truck-van-demand-drive-november-auto-sales">Truck, Van Demand Drive November Auto Sales</a> 
	<a href="https://www.benzinga.com/analyst-ratings/analyst-color/17/09/10040623/the-35-year-forecast-for-electric-vehicles">The 35-Year Forecast For Electric Vehicles</a>

Reiteration

Morgan Stanley On Autos: Expect Autonomous 'Noise,' 'Idiosyncratic' Returns

Value stocks are favored in this market rotation and some auto names are riding the trend.
Amid great disparity between growth and value, a UBS analyst expressed a preference for the likes of General Motors Company (NYSE: <a class="ticker" href="/stock/gm#NYSE">GM</a>) and Ford Motor Company (NYSE: <a class="ticker" href="/stock/f#NYSE">F</a>).
<h3>
	The Ratings</h3>
Analyst <a href="https://www.tipranks.com/analysts/colin-langan">Colin Langan</a> reiterated Buy ratings on Adient PLC (NYSE: <a class="ticker" href="/stock/adnt#NYSE">ADNT</a>) ($95 price target), BorgWarner Inc. (NYSE: <a class="ticker" href="/stock/bwa#NYSE">BWA</a>) ($61 price target), Tenneco Inc (NYSE: <a class="ticker" href="/stock/ten#NYSE">TEN</a>) ($70 price target), Ford ($15 price target) and General Motors ($50 price target).
He reiterated Holds and adjusted price targets on:
<ul>
<li>
		Dana Inc (NYSE: <a class="ticker" href="/stock/dan#NYSE">DAN</a>): PT raised from $30 to $33;</li>
<li>
		Delphi Technologies PLC (NYSE: <a class="ticker" href="/stock/dlph#NYSE">DLPH</a>): PT maintained at $58;</li>
<li>
		Aptiv PLC (NYSE: <a class="ticker" href="/stock/aptv#NYSE">APTV</a>): PT maintained at $89;</li>
<li>
		Lear Corporation (NYSE: <a class="ticker" href="/stock/lea#NYSE">LEA</a>): PT raised from $184 to $186;</li>
<li>
		Magna International Inc. (USA) (NYSE: <a class="ticker" href="/stock/mga#NYSE">MGA</a>): PT raised from $52 to $57;</li>
<li>
		Meritor Inc (NYSE: <a class="ticker" href="/stock/mtor#NYSE">MTOR</a>): PT maintained at $26;</li>
<li>
		Visteon Corp (NYSE: <a class="ticker" href="/stock/vc#NYSE">VC</a>): PT raised from $125 to $129.</li>
</ul>
<h3>
	The Thesis</h3>
&ldquo;It&rsquo;s hard to ignore the performance gap between growth and value,&rdquo; Langen said. &ldquo;The secular growers are up 29 percent year-to-date, almost twice the gains of &lsquo;value&rsquo; suppliers (up 14 percent). However, the average five-year CAGR of growth names was only 30 basis points higher than value, with many &lsquo;value&rsquo; suppliers outperforming most growth names.&rdquo; (See Langen&#39;s track record <a href="https://www.tipranks.com/analysts/colin-langan">here</a>.)&nbsp;
Langen anticipates buyback-driven swells in General Motors and improved international sales and fewer recalls for Ford.
A weakening dollar and double-digit increases in heavy truck and off-highway vehicles could boost exposed suppliers Meritor, Dana, BorgWarner, Delphi and Tenneco in 2018, he said. The former three are considered the best positioned on market mix, according to UBS.&nbsp;
Auto players may also catch a tailwind off government activity. Suppliers could benefit from a 2- to 4-percent tax cut as Ford and General Motors enjoy an 11-percent slice, while a breakup of NAFTA could drive cost increases between 0.7 percent and 5.4 percent, Langen said.&nbsp;
<h3>
	Price Action</h3>
At the time of publication, First Trust Exchange-Traded Fund II (NASDAQ: <a class="ticker" href="/stock/carz#NASDAQ">CARZ</a>) tracking car manufacturers was trading up 1.1 percent at $42.02.
Related Link:
<a href="https://www.benzinga.com/news/17/12/10861597/truck-van-demand-drive-november-auto-sales?viewDesktop=1">Truck, Van Demand Drive November Auto Sales</a>
<a href="https://www.benzinga.com/analyst-ratings/analyst-color/17/11/10839782/analyst-sees-possible-big-bang-of-upside-for-general-mo">Analyst Sees Possible &#39;Big Bang&#39; Of Upside For General Motors&nbsp;</a>

Price Target

ADNT

APTV

DLPH

MTOR

Ford, GM Among The Top UBS Value Plays For 2018

CNBC

Retail Sales

CNBC's Phil Lebeau Tweets: Aug. Auto Sales rate was 16.14 million....roughly in line with lowered expectations after Hurricane Harvey.  Per AutoData

Autodata Reports April Light Vehicle Seasonally Adjusted Annual Rate Of 16.88M Units vs 17.1M Units Est.

The First Trust NASDAQ Global Auto Index Fund (NASDAQ: <a class="ticker" href="/stock/carz#NASDAQ">CARZ</a>) is higher by nearly 3.9 percent in 2017 and robust sales are playing a pivotal role in the recent success for the lone exchange traded fund dedicated to the auto industry.
Last week, Jefferies upgraded Ford Motor Company (NYSE: <a class="ticker" href="/stock/f#NYSE">F</a>) saying the automaker&#39;s &ldquo;bad news has been more than dissected in the last six months and sufficiently priced-in.&rdquo; Ford&#39;s above average exposure to light and medium duty work vehicles, most of them sourced in the United States, which bodes well in an environment of infrastructure spending, <a href="https://www.benzinga.com/analyst-ratings/analyst-color/17/02/9025731/fords-bad-news-has-been-sufficiently-priced-in-over-last">Benzinga reported</a>.
General Motors Company (NYSE: <a class="ticker" href="/stock/gm#NYSE">GM</a>) and Ford, the two largest U.S. automakers, combine for about 15 percent of the roster in CARZ.
&ldquo;IHS Markit&rsquo;s sector PMI data show worldwide auto industry production rising at its fastest rate in just over six years in recent months, with production surging again in January amid strong order book growth,&rdquo; <a href="http://www.markit.com/Commentary/Get/10022017-Economics-Global-auto-sector-booms-but-also-struggles-with-higher-costs">said Markit in a recent note</a>. &ldquo;Inflows of new orders into the autos and parts sector rose at the start of the year at the fastest rate since early 2011; a period when post-recession incentives were boosting car sales globally. The recent upturn in sales and production represents a marked contrast to the stagnation and decline seen during the early months of 2016.&rdquo;
While the presence of the &ldquo;Detroit Three&rdquo; looms large in CARZ, the ETF reflects the global nature of the auto business as U.S. firms are just 23.7 percent of the ETF&#39;s weight, below the 33 percent allocated to Japanese automakers.
Japanese and German automakers combine for 52 percent of CARZ, underscoring the point that this ETF is potentially exposed to currency risk. One issue is that CARZ isn&#39;t currency hedged so it lacks that kicker to fully exploit dollar strength. Second, and equally important, is dollar weakness, a scenario which can pinch foreign automakers that count on the U.S. for significant portions of their revenue.
Selling costs are also rising, an issue investors should be aware before considering CARZ or individual auto names,
&ldquo;Selling costs are also rising, but at a much reduced rate compared to input costs. The differential between selling price and input cost inflation has consequently indicated the greatest squeeze on auto company operating margins since early-2011 in recent months,&rdquo; adds Markit.

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First Trust S-Network Future Vehicles & Technology ETF declares quarterly distribution of $0.0570

Car stocks got clobbered as the global auto industry is heading for a major fall.

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S&P Global warns the auto industry has a tough road ahead

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