The overall market performance in the first half of the year was good, with the S&P 500 Index and the Nasdaq Index hitting new highs. So far this year, the S&P 500 is up about 13% and the Nasdaq is up 14.9%. Will the market continue to soar? Analysts are divided as it remains uncertain when the Fed will begin cutting interest rates. Much will depend on the direction of inflation data in the coming months. Thomas Poullaouec, head of multi-asset solutions for Asia Pacific at T. Rowe Price, said on Tuesday: “A U.S. recession is not expected within the next six months, and leading economic indicators point to broader global growth, undermining claims of U.S. exceptionalism.” . “The central bank hopes that, and with labor markets resilient and services sector inflation continuing to rise, there is a significant risk of a re-acceleration.” Ed Clissold, chief U.S. strategist at Ned Davis Research, believes conditions may allow The Fed is “slowly cutting rates” because he believes economic growth may slow but won’t turn negative. Against this backdrop of uncertainty, investors may consider exchange-traded funds or mutual funds to diversify their investments. CNBC Pro screened the 20 best-performing U.S.-registered ETFs and actively managed funds in the first half of this year to identify funds with further upside. Morningstar provides a list of the top-performing funds that all beat the S&P 500. into the rating. Copper and mining ETFs were the big winners in the first half of the year, with four in the top 20. However, of the four stocks, only two met the screening criteria: Sprott Junior Copper Miners ETF and Global X Copper Miners ETF. The former stands out on the list, with the highest potential upside (45.8%) and a high Buy rating (79%). Unsurprisingly, growth funds also dominate the list as the tech and artificial intelligence boom continues to drive markets higher this year. A country-specific ETF has made the list: the iShares MSCI Türkiye ETF. As of May 31, the stock’s half-year return was 29.55%, ranking among the top five. A category not typically favored by investors also emerged: the small- and mid-cap-focused First Trust RBA American Industrial Renaissance ETF. It tracks the Richard Bernstein Advisors U.S. Industrial Renaissance Index, which measures the performance of U.S. small and mid-sized companies in the industrial and community banking sectors.
