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3 Sector ETFs & Stocks to Gain Despite Soft Jobs Data
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The U.S. economy added 150,000 jobs in October 2023, about half of a downwardly revised 297,000 in September, and below market forecasts of 180,000. The report revealed that the labor market is slowly cooling as several strikes including from members of the UAW weighed on the manufacturing payrolls.
The unemployment rate reached 3.9% in October. Since their recent lows in April, these measures are up by 0.5 percentage point. However, the unemployment rate marked the highest level since January 2022, against expectations that it would hold steady at 3.8%, per CNBC. Employment Rate in the United States declined to 60.20% in October from 60.40% in September of 2023.
Average hourly earnings, a key measure for inflation, increased 0.2% for the month, less than the 0.3% forecast, while the 4.1% year-over-year gain was 0.1 percentage point above expectations. The average work week nudged lower to 34.3 hours.
Below, we have highlighted some of the sectors that will likely see smooth trading in the days ahead in light of the October jobs data.
Sectors in Focus
Healthcare
Employment in the healthcare industry increased by 58,000 in jobs, in line with the average monthly gain of 53,000 over the prior 12 months. Job gains occurred in ambulatory health care services (+32,000), hospitals (+18,000) and nursing and residential care facilities (+8,000).
The Zacks Rank #1 (Strong Buy) Health Care Select Sector SPDR ETF (XLV - Free Report) can be played to tap the moderate momentum. HCA Healthcare (HCA - Free Report) , which has a Zacks Rank #3 (Hold) deserves a mention. It is the largest non-governmental operator of acute care hospitals in the United States.
Leisure
Employment in leisure and hospitality rose by 19,000. The industry had added an average of 52,000 jobs per month over the past one year.
The data makes ETFMG Travel Tech ETF (AWAY - Free Report) a timely investment. The underlying Prime Travel Technology Index tracks the performance of globally exchange-listed equity securities or corresponding ADRs or GDRs engaged in Travel Technology Business which provides technology, via the internet & internet-connected devices such as mobile phones, to facilitate travel bookings & reservations, ride sharing & hailing, travel price comparison & travel advice.
The Zacks Rank #1 Wingstop (WING - Free Report) , franchises and operates restaurants. The Company's operating segment consists of Franchise segment and Company segment.
Construction
In October, employment in construction (+23,000) saw notable growth, in line with the average monthly gain of 18,000 over the past one year. Employment continued to trend up over the month in specialty trade contractors (+14,000) and construction of buildings (+6,000).
Investors can keep a watch on the price movement of Invesco Dynamic Building & Construction ETF (PKB - Free Report) . The underlying Dynamic Building & Construction Intellidex Index is comprised of stocks of U.S. building and construction companies.
As far as the stock is concerned, Zacks Rank #1 Granite Construction (GVA - Free Report) can be played. It is one of the nation's largest infrastructure contractors and construction materials producers.
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3 Sector ETFs & Stocks to Gain Despite Soft Jobs Data
The U.S. economy added 150,000 jobs in October 2023, about half of a downwardly revised 297,000 in September, and below market forecasts of 180,000. The report revealed that the labor market is slowly cooling as several strikes including from members of the UAW weighed on the manufacturing payrolls.
The unemployment rate reached 3.9% in October. Since their recent lows in April, these measures are up by 0.5 percentage point. However, the unemployment rate marked the highest level since January 2022, against expectations that it would hold steady at 3.8%, per CNBC. Employment Rate in the United States declined to 60.20% in October from 60.40% in September of 2023.
Average hourly earnings, a key measure for inflation, increased 0.2% for the month, less than the 0.3% forecast, while the 4.1% year-over-year gain was 0.1 percentage point above expectations. The average work week nudged lower to 34.3 hours.
Below, we have highlighted some of the sectors that will likely see smooth trading in the days ahead in light of the October jobs data.
Sectors in Focus
Healthcare
Employment in the healthcare industry increased by 58,000 in jobs, in line with the average monthly gain of 53,000 over the prior 12 months. Job gains occurred in ambulatory health care services (+32,000), hospitals (+18,000) and nursing and residential care facilities (+8,000).
The Zacks Rank #1 (Strong Buy) Health Care Select Sector SPDR ETF (XLV - Free Report) can be played to tap the moderate momentum. HCA Healthcare (HCA - Free Report) , which has a Zacks Rank #3 (Hold) deserves a mention. It is the largest non-governmental operator of acute care hospitals in the United States.
Leisure
Employment in leisure and hospitality rose by 19,000. The industry had added an average of 52,000 jobs per month over the past one year.
The data makes ETFMG Travel Tech ETF (AWAY - Free Report) a timely investment. The underlying Prime Travel Technology Index tracks the performance of globally exchange-listed equity securities or corresponding ADRs or GDRs engaged in Travel Technology Business which provides technology, via the internet & internet-connected devices such as mobile phones, to facilitate travel bookings & reservations, ride sharing & hailing, travel price comparison & travel advice.
The Zacks Rank #1 Wingstop (WING - Free Report) , franchises and operates restaurants. The Company's operating segment consists of Franchise segment and Company segment.
Construction
In October, employment in construction (+23,000) saw notable growth, in line with the average monthly gain of 18,000 over the past one year. Employment continued to trend up over the month in specialty trade contractors (+14,000) and construction of buildings (+6,000).
Investors can keep a watch on the price movement of Invesco Dynamic Building & Construction ETF (PKB - Free Report) . The underlying Dynamic Building & Construction Intellidex Index is comprised of stocks of U.S. building and construction companies.
As far as the stock is concerned, Zacks Rank #1 Granite Construction (GVA - Free Report) can be played. It is one of the nation's largest infrastructure contractors and construction materials producers.