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US Trade Deficit Declines in May: ETFs in Focus

The U.S. trade deficit shrank in May 2017, owing to impressive export data. Rising shipments of automobiles and consumer goods contributed to the decline.

Per the Commerce Department, U.S. trade deficit declined 2.3% in May to $46.5 billion compared with $47.6 billion in April, while exports increased 0.4% to a two-year high of $192 billion.

Among its biggest partners, U.S. trade deficit with China declined 2.3% to $30.1 billion in May, while with the European Union it declined almost 20% to settle at $10.7 billion. However, owing to uncertainty over NAFTA renegotiation talks, trade deficit with Mexico increased 5.6% to $6.8 billion.

President Donald Trump’s primary agenda has been on renegotiating ‘unfair’ trade deals with the trading partners of the U.S. and to bring down the deficit of the world’s largest economy (read: Blue Chips to Soar Ahead? Buy These 5 ETFs).

As far as the economy’s performance is concerned, U.S. manufacturing sentiment represented by the Institute for Supply Management Manufacturing (ISM) index surged to a three-year high of 57.8 in June 2017 compared with 54.9 in May. Moreover, services sector increased to a two-month high. ISM non-manufacturing purchasing managers’ index rose to 57.4 in June, compared with 56.9 in May (read: U.S. Economic Growth Improves: ETFs to Buy).

Let us now discuss a few ETFs focused on providing exposure to U.S. Industrial equities.

Industrial Select Sector SPDR Fund XLI

This fund is one...