U.S. stock markets are flying high in November after three consecutive months of decline. Most of the market participants are confident that the Fed has already come to an end of the current interest rate hike cycle. The CME FedWatch tool has associated a 97% probability that the central bank will keep the benchmark lending rate unchanged at 5.25-5.5%.

Month to date, the three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — have rallied 7.2%, 8.6% and 11.1%, respectively. Moreover, the U.S. economy may gain further steam in 2024 as the Fed is set to initiate a rate cut in the second half of the year.

Meanwhile, the Conference Board stated that its consumer confidence index increased to 102.0 this month from a downwardly revised 99.1 last month. The consumer confidence index advanced more than analysts’ expectations of 100.9. Confidence among consumers strengthened as they are now feeling much better about future business scenarios, income and job availability.

The Present Situation Index— based on consumers’ assessment of current business and labor market conditions— fell marginally to 138.2 in November from 138.6 in October. The Expectations Index— based on consumers’ short-term outlook for income, business, and labor market conditions— rose to 77.8 in November from 72.7 in October.

The research reveals that worries among consumers about an approaching recession have reached their lowest point for this year. The level of confidence among consumers plays a crucial role in assessing their spending over the next three to six months. The greater the confidence households have, the more inclined they are to spend money. This is especially true given the all-important holiday season is approaching.

ETFs to Play

Against this backdrop, below we highlight a few ETFs that could be tapped now.

Consumer Discretionary Select Sector SPDR ETF (XLY Quick QuoteXLY - Free Report)

The underlying Consumer Discretionary Select Sector Index seeks to provide an effective representation of the consumer discretionary sector of the S&P 500 Index. The fund has a Zacks Rank #1 (Strong Buy).

AdvisorShares Restaurant ETF (EATZ Quick QuoteEATZ - Free Report)

The AdvisorShares Restaurant ETF is an actively managed exchange-traded fund that seeks to achieve its investment objective by investing at least 80% of its net assets in securities of companies that derive at least 50% of their net revenue from the restaurant business. The fund charges 99 bps in fees.

Defiance Hotel, Airline, and Cruise ETF (CRUZ Quick QuoteCRUZ - Free Report)

The underlying BlueStar Global Hotels, Airlines, and Cruises Index is a rules-based index that consists of globally-listed stocks of companies that derive at least 50% of their revenues from the passenger airline, hotel and resort, or cruise industries. The fund charges 45 bps in fees (read: Is the End of "Revenge Travel" a Threat to Tourism ETFs?).

ETFMG Travel Tech ETF (AWAY Quick QuoteAWAY - Free Report)

The underlying Prime Travel Technology Index NTR 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 fund charges 75 bps in fees.

Kelly Hotel & Lodging Sector ETF

The underlying Strategic Hotel & Lodging Sector Index consists of the stocks or corresponding depositary receipts of companies engaged in the creation, development, production, operation, provision, distribution, servicing, licensing, leasing or franchising of at least one of Hotel & Lodging Services or Hotel & Lodging Operations. The fund charges 78 bps in fees.