5 Sector ETFs That Beat the Market in May
Wall Street staged a solid comeback in May from early April lows, which were triggered by the "Liberation Day" tariffs. The S&P 500 experienced the fastest recovery since 1982, according to Bespoke Investment Group. Trade deal talks and solid tech earnings buoyed market sentiments. A resilient economy added to further strength. The rally has been broad-based. We have highlighted five top-performing ETFs from different industries that were the leaders over the past month. These are Global X Uranium ETF URA, VanEck Vectors Digital Transformation ETF DAPP, Sprott Nickel Miners ETF NIKL, Grayscale Bitcoin Adopters ETF BCOR and Generative AI & Technology ETF CHAT.
After the initial shock of the tariffs, there were signs of de-escalation. This month, the United States temporarily slashed tariffs on Chinese goods from 145% to 30%, while China will lower its retaliatory duties on U.S. goods from 125% to 10%. The temporary reduction in rates will run for 90 days.Meanwhile, Trump also postponed the implementation of a 50% tariff increase on all EU products, from June 1 to July 9. With this, the trade negotiations between the two countries have accelerated.
The bouts of economic data supported the bullish sentiment. Consumer confidence in the economy improved in May after five straight months of declines. Inflation in April cooled to the lowest level since February 2021. The Consumer Price Index, which tracks a variety of costs throughout the economy, rose 2.3% year over year in April, down slightly from 2.4% in March. Meanwhile, the U.S. labor market remained resilient amid the tariff chaos. The economy added better-than-expected 177,000 jobs while the unemployment rate held steady at 4.2%, providing further assurance about the economy's health (read: Consumer Confidence Surges in May: ETFs to Gain).
Total first-quarter earnings for the 477 S&P 500 members that have reported results are up 11.4% from the same period last year on 4.4% higher revenues, with 74.2% beating EPS estimates and 62.9% beating revenue estimates, per Zacks Earnings Trends.Overall, companies struggled to beat consensus estimates this reporting cycle. However, the technology sector results have been better than expected, with the earnings growth rates primarily in line with recent periods. Notably, the first-quarter revenue beat percentage is above the 5-year average.
Uncertainty surrounding Trump's tariff plans continues to linger. While some tariffs were challenged in court, with rulings deeming them unlawful, an appeals court temporarily reinstated them. The legal back-and-forth has introduced volatility and uncertainty into the market.Additionally, the rapid market recovery led to elevated valuations, with the S&P 500 trading at over 22 times 2025 earnings. Analysts caution that such levels may not be sustainable without continued positive developments.Let's dig into the details of the abovementioned ETFs:Global X Uranium ETF (URA) – Up 34.6%Global X Uranium ETF provides investors access to a broad range of companies involved in uranium mining and the production of nuclear components, including those in extraction, refining, exploration, or manufacturing of equipment for the uranium and nuclear industries. It tracks the Solactive Global Uranium & Nuclear Components Total Return Index and holds 48 stocks in its basket. Canadian firms make up the largest allocation in the basket at 39.7% while the United States accounts for a 16.6% share. Global X Uranium ETF has amassed $3 billion in its asset base and charges 69 bps in annual fees. It trades in an average daily volume of 3.4 million shares (read: ETFs to Capitalize on Trump's Orders to Spur Nuclear Energy).VanEck Vectors Digital Transformation ETF (DAPP) – Up 26.9%VanEck Vectors Digital Transformation ETF aims to offer exposure to companies that are at the forefront of digital asset transformation, such as digital asset exchanges, payment gateways, digital asset mining operations, software services, equipment and technology or services to the digital asset operations, digital asset infrastructure businesses or companies facilitating commerce with the use of digital assets. VanEck Vectors Digital Transformation ETF tracks the MVIS Global Digital Assets Equity Index and holds 23 securities in its basket. It charges 51 bps in annual fees and trades in an average daily volume of 613,000. DAPP has accumulated $182.4 million in its asset base.Sprott Nickel Miners ETF (NIKL) – Up 19.3%Sprott Nickel Miners ETF is the only U.S.-listed ETF focused on nickel mining companies, providing a critical material necessary to meet the rising global demand for batteries and energy storage, along with continuing demand for stainless steel. It tracks the Nasdaq Sprott Nickel Miners Index and holds 21 stocks in its basket. Sprott Nickel Miners ETF has amassed $9.9 million in its asset base and trades in an average daily volume of 40,000 shares. It charges 75 bps in annual fees.Grayscale Bitcoin Adopters ETF (BCOR) – Up 19.2%Grayscale Bitcoin Adopters ETF offers exposure to a global basket of publicly traded companies that have adopted Bitcoin as part of their corporate treasury. This theme focuses on the long-term growth of the corporate adoption of Bitcoin as a hedge against fiat inflation and a tool for corporate treasury diversification and risk management. Grayscale Bitcoin Adopters ETF has accumulated $3 million in its asset base since its inception in late April and charges 59 bps in annual fees (read: ETFs to Ride on New Wave of $111K Bitcoin Rally). Generative AI & Technology ETF (CHAT) – Up 19%Generative AI & Technology ETF is the world's first Generative AI ETF and is an actively managed ETF. It provides exposure to impactful technological innovations now and into the future and holds 38 stocks in its basket. Generative AI & Technology ETF has amassed $274.6 million in its asset base and trades in an average daily volume of 53,000 shares. It charges 75 bps in annual fees.
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Global X Uranium ETF (URA): ETF Research Reports
VanEck Digital Transformation ETF (DAPP): ETF Research Reports
Sprott Nickel Miners ETF (NIKL): ETF Research Reports
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