Latest news with #ConsumerDiscretionarySelectSectorSPDRFund
Yahoo
10 hours ago
- Business
- Yahoo
Consumer Rebound Boosts Outlook for Discretionary ETFs
Americans have started to feel optimistic about the economy, as the initial shock from steep tariffs begins to wear off and inflation pressures ease. Rising consumer sentiment bodes well for household spending in the coming months. It is expected to have a positive impact on the consumer discretionary sector, which attracts a major portion of consumer spending. Investors can tap the encouraging trend in the basket form through consumer discretionary ETFs like Consumer Discretionary Select Sector SPDR Fund XLY, Vanguard Consumer Discretionary ETF VCR and iShares U.S. Consumer Services ETF IYC. These funds have a Zacks ETF Rank #3 (Hold).U.S. consumer sentiment climbed in June for the first time in six months, offering a glimmer of optimism amid lingering policy uncertainty. According to preliminary data from the University of Michigan's Surveys of Consumers, the Consumer Sentiment Index jumped to 60.5, up from 52.2 in May and well above economists' expectations of 53.6. The rebound follows one of the lowest sentiment readings on record in May. Short and long-term inflation forecasts softened notably. One-year inflation expectations dropped significantly to 5.1% in June, down from 6.6% in May—a level not seen in over four decades. Expectations for inflation over the next five to 10 years also edged down slightly to 4.1% from 4.2% the previous month (read: Sector ETFs Set to Gain as Inflation Cools in May). The surge in confidence followed the Trump administration's decision to delay new tariffs in April and reach a temporary truce with China in May. As Surveys of Consumers Director Joanne Hsu remarked, 'Consumers appear to have settled somewhat from the shock of the extremely high tariffs announced in April and the policy volatility seen in the weeks that followed.'These shifts suggest consumers are regaining some confidence as economic conditions stabilize and uncertainty around trade policy begins to diminish. The data aligns with the other survey report released late last month. The Conference Board's Consumer Confidence Index rose sharply in May to 98, well above April's 85.7 reading and comfortably ahead of the 87.1 economists had forecast. Its expectations index, which gauges the outlook for income, business, and labor conditions over the next six months, surged to 72.8 in May from a 13-year low of 55.4 in April — the strongest monthly jump since May 2009. Consumer Discretionary Select Sector SPDR Fund (XLY) Consumer Discretionary Select Sector SPDR Fund offers exposure to the broad consumer discretionary space and tracks the Consumer Discretionary Select Sector Index. It holds 51 securities in its basket, with key holdings in hotels, restaurants and leisure, broadline retail, specialty retail, and automobiles with a double-digit allocation each (read: Consumer Discretionary ETFs Set for a Comeback?).Consumer Discretionary Select Sector SPDR Fund is the largest and most popular product in this space, with AUM of $21.7 billion and an average daily volume of around 4 million shares. It charges 0.08% in expense Consumer Discretionary ETF (VCR) Vanguard Consumer Discretionary ETF follows the MSCI U.S. Investable Market Consumer Discretionary 25/50 Index and holds 296 stocks in its basket. In terms of industrial exposure, broadline retail, automobile manufacturers and restaurants occupy the top three spots. Vanguard Consumer Discretionary ETF is the low-cost choice in the space, charging investors only 9 bps in annual fees while volume is good at nearly 77,000 shares a day. The fund has managed $6 billion in its asset base so U.S. Consumer Services ETF (IYC)iShares U.S. Consumer Discretionary ETF offers exposure to U.S. companies that distribute food, drugs, general retail items and media by tracking the Russell 1000 Consumer Disc 40 Act 15/22.5 Daily Capped Index. It holds 174 stocks in its basket, with key holdings in consumer discretionary, consumer services, media & entertainment, and autos & U.S. Consumer Discretionary ETF has amassed $1.5 billion in its asset base and trades in a moderate volume of 86,000 shares a day on average. It charges 39 bps in annual fees from investors. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports iShares U.S. Consumer Discretionary ETF (IYC): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research
Yahoo
5 days ago
- Business
- Yahoo
Consumer Discretionary ETFs Set for a Comeback?
As markets rally on renewed trade-talk optimism, investors are turning bullish with a rising risk appetite. The S&P 500 Consumer Discretionary Index has increased 20.14% over the past year and 10.78% quarter to date, outperforming the S&P 500 Index. The broad market index has gained 12.65% and 7.61% over the past year and quarter to date, respectively. Lower likelihood of a recession, improved consumer sentiment and progressing trade talks between Washington-Beijing are fueling the consumer discretionary sector's momentum. According to CNBC, recession concerns among business leaders are easing. Per the data, just under 30% of CEOs now expect a mild or severe recession in the next six months, down from 46% in May and 62% in April. Optimism is also rising in the economy, with more than 40% of the surveyed CEOs now expecting some level of economic growth in the United States, nearly double the 23% who felt the same in April. This reflects a notable shift in sentiment among corporate leaders, signaling growing confidence in the resilience of the U.S. economy. Per a survey by New York Federal Reserve, as quoted on CNBC, easing inflation worries among average consumers following President Trump's decision to roll back some of his more aggressive trade measures is helping the cyclical sectors. According to a survey by the Conference Board, the Consumer Confidence Index jumped to 98.0 in May, marking a 12.3-point increase from April, giving consumer sentiment a much-needed boost. According to CNBC, driven by progressing trade talks between Wahington and Beijing, investors are turning bullish, with 44% anticipating higher stock prices in the next 12 months, up from 37.6% in April. Markets traded higher after China and the United States announced that they had agreed on a framework to build on the trade truce reached in Geneva last month, according to Yahoo Finance. The rally in consumer discretionary funds highlight rising optimism about the economy and expectations for stronger consumer spending. Consumer discretionary funds have performed comparatively better than the SPDR S&P 500 ETF SPY, which has gained 6.28% over the past month and 13.41% over the past year. Below, we highlight a few consumer discretionary funds for investors to consider. Consumer Discretionary Select Sector SPDR Fund seeks to track the performance of the Consumer Discretionary Select Sector Index with a basket of 51 securities. The fund has amassed an asset base of $21.52 billion and charges an annual fee of 0.08%. The fund has double-digit exposure to Amazon AMZN and Tesla TSLA, with 23.17% and 16.17%, respectively. XLY has about 97.97% of its assets allocated to large-cap securities and has a weighted alpha of 18.42. Consumer Discretionary Select Sector SPDR Fund has gained 8.48% over the past month and 22.74% over the past year. Vanguard Consumer Discretionary ETF seeks to track the performance of the MSCI US Investable Market Consumer Discretionary 25/50 Index with a basket of 292 securities. The fund has amassed an asset base of $5.78 billion and charges an annual fee of 0.09%. The fund has double-digit exposure to AMZN and TSLA, with 22.54% and 14.30%, respectively. VCR has about 62.5% of its assets allocated to large-cap securities and has a weighted alpha of 15.49. Vanguard Consumer Discretionary ETF has gained 9.35% over the past month and 17.87% over the past year. Fidelity MSCI Consumer Discretionary Index ETF seeks to track the performance of the MSCI USA IMI Consumer Discretionary 25/50 Index with a basket of 262 securities. The fund has amassed an asset base of $1.75 billion and charges an annual fee of 0.08%. The fund has double-digit exposure to AMZN and TSLA, with 22.89% and 16.06%, respectively. FDIS has about 66.95% of its assets allocated to large-cap securities and has a weighted alpha of 15.6. Fidelity MSCI Consumer Discretionary Index ETF has gained 9.30% over the past month and 17.92% over the past year. First Trust Consumer Discretionary AlphaDEX Fund seeks to track the performance of the StrataQuant Consumer Discretionary Index with a basket of 122 securities. The fund has amassed an asset base of $327.5 million and charges an annual fee of 0.61%. The fund has the top allocation to Carvana CVNA, with a share of 2.04%, indicating that it has less concentration risk. FXD has about 52.34% of its assets allocated to large-cap securities and has a weighted alpha of 5.23. First Trust Consumer Discretionary AlphaDEX Fund has gained 8.64% over the past month and 1.96% over the past year. Invesco S&P 500 Equal Weight Consumer Discretionary ETF seeks to track the performance of the S&P 500 Equal Weight Consumer Discretionary Index with a basket of 53 securities. The fund has amassed an asset base of $207.6 million and charges an annual fee of 0.40%. The fund's top allocation to Ulta Beauty ULTA, with a share of 2.72%, indicates that it has less concentration risk. RSPD has about 83.57% of its assets allocated to large-cap securities and has a weighted alpha of 9.37. Invesco S&P 500 Equal Weight Consumer Discretionary ETF has gained 5.76% over the past month and 8.23% over the past year. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Inc. (AMZN) : Free Stock Analysis Report Ulta Beauty Inc. (ULTA) : Free Stock Analysis Report Tesla, Inc. (TSLA) : Free Stock Analysis Report SPDR S&P 500 ETF (SPY): ETF Research Reports Consumer Discretionary Select Sector SPDR ETF (XLY): ETF Research Reports Vanguard Consumer Discretionary ETF (VCR): ETF Research Reports Fidelity MSCI Consumer Discretionary Index ETF (FDIS): ETF Research Reports First Trust Consumer Discretionary AlphaDEX ETF (FXD): ETF Research Reports Carvana Co. (CVNA) : Free Stock Analysis Report Invesco S&P 500 Equal Weight Consumer Discretionary ETF (RSPD): ETF Research Reports This article originally published on Zacks Investment Research ( Zacks Investment Research Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
