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3 Sector ETFs & Stocks Likely to Benefit On Solid Jobs Data

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The US economy added 272,000 jobs in May 2024, the maximum in five months, compared to a downwardly revised 165,000 in April, and well above forecasts of 185,000. The reading is also higher than the average monthly gain of 232,000 over the prior 12 months and 246,000 in the first four months of the year.

Employment Rate in the United States fell 60.10% in May from 60.20% in April of 2024. Employment Rate in the United States averaged 59.25% from 1948 until 2024, reaching an all-time high of 64.70% in April of 2000 and a record low of 51.20% in April of 2020, per tradingeconomics.

In May, average hourly earnings for all employees on private nonfarm payrolls rose 0.4% to $34.91. Over the past 12 months, average hourly earnings have increased by 4.1%.

Below, we have highlighted some of the sectors that will likely see smooth trading in the days ahead in light of the May jobs data.

Sectors in Focus


Employment in the healthcare industry increased by 68,000 in jobs, in line with the average monthly gain of 64,000 over the prior 12 months. Considerable job gains occurred in ambulatory health care services (+43,000), hospitals (+15,000), and nursing and residential care facilities (+11,000).

The Zacks Rank #1 (Strong Buy) Health Care Select Sector SPDR ETF (XLV - Free Report) can be played to tap the moderate momentum. Tenet Healthcare (THC - Free Report) , which has a Zacks Rank #1 deserves a mention. It is an investor-owned health care services company, which owns and operates general hospitals and related health care facilities for urban and rural communities in numerous states, and has offices in California and Florida.       


Employment in leisure and hospitality rose by 42,000 the average. Over the past one year, job growth in the industry had averaged 35,000 per month. Employment in food services and drinking places continued to go up over the month (+25,000).

The data makes Invesco Dynamic Leisure and Entertainment ETF (PEJ - Free Report) a timely investment. The Zacks Rank #2 Brinker International (EAT - Free Report) , owns, operates, develops and franchises various restaurants under Chili’s Grill & Bar (Chili’s) and Maggiano’s Little Italy (Maggiano’s) brands.


Retail trade continued to trend up in May (+13,000). Over the prior 12 months, the industry had added an average of 8,000 jobs per month. In May, notable employment (+12,000) was seen in areas like building material and garden equipment and supplies dealers.

As far as the fund is concerned, VanEck Retail ETF (RTH - Free Report) has a Zacks Rank #2. Louisiana Pacific (LPX - Free Report) has a Zacks Rank #1 (Strong Buy). The company is a leading manufacturer of sustainable, quality engineered wood building materials, structural framing products as well as exterior siding for use in residential, industrial and light commercial construction.


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