Investors are flocking to infrastructure stocks.
All on the passage of a $1 trillion bill over the weekend, which includes funding for:
- Roads, bridges, major projects: $110 billion
- Passenger and freight rail: $66 billion
- Public transit: $39 billion
- Airports: $25 billion
- Port infrastructure: $17 billion
- Transportation safety programs: $11 billion
- Electric vehicles: $7.5 billion
- Zero and low-emission buses and ferries: $7.5 billion
- Revitalization of communities: $1 billion
Stocks like Caterpillar, US Steel, Steel Dynamics, Nucor, Vulcan Materials, Fluor, Martin Marietta, and Eagle Materials to name a few, took off.
Even the Global X US Infrastructure ETF (PAVE) is pushing higher on the news.
Hopefully, we’ll start to see big improvements to US infrastructure soon.
Remember, just months ago, the American Society of Civil Engineers gave the country a C- — an improvement from a D+ in 2017.
“Many of the country’s roads, bridges, airports, dams, levees and water systems are aging and in poor to mediocre condition. And they’re in need of a major federal investment to keep from getting worse and to withstand the harsh effects of a changing climate, according to the American Society of Civil Engineers,” as reported by NPR at the time.
Plus, according to the ASCE, 47% of the 617,000 bridges are more than 50 years old. More than 46,000 of them were deemed “structurally deficient.”
While there’s a good deal of excitement for these stocks, be cautious. With related Infrastructure stocks pricing in a good amount of news to date, we could begin to see a “sell the news” reaction from profit takers.
Stay tuned for more on this developing story.