We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Weak jobs data boosts hopes for Fed easing and supports defensive sectors.
Health care added 22,000 jobs, with XLV offering diversified exposure.
Retail hiring was led by sporting goods and hobby stores, favoring XRT and DKS.
Nonfarm payrolls fell by a seasonally adjusted 23,000 in July, compared with a downwardly revised 20,000 in June. The Dow Jones consensus forecast had been looking for a gain of 83,000, as quoted on CNBC.
The unemployment rate dipped to 4.1% as the labor force participation rate dropped further to 61.4%, its lowest in more than five years, another indication that fewer Americans were working or looking for jobs.
In addition to the weak June and July figures, May’s final payroll count was revised down to 63,000, or 66,000 lower than the previous estimate. The revisions brought the 12-month average down to just 34,000.
In July, average hourly earnings rose by just $0.02 to $37.62. Over the year, average hourly earnings increased by 3.2%.
Winning ETF Areas in Focus
Health Care
Health care employment has been an area of strength. Health care employment added 22,000 jobs in July. However, job growth slowed from the average monthly gain over the prior 12 months (+36,000). Employment in ambulatory health care services continued to increase during the month.
Health Care Select Sector SPDR ETF (XLV - Free Report) can be played to tap the moderate momentum. The fund has 37% exposure to the pharma industry, followed by 18.8% exposure to the health care equipment & supplies, about 18.4% focus on biotechnology, 16.65% exposure to the healthcare providers & services industry, and 8.8% focus on the life sciences tools & services.
Surgery Partners (SGRY - Free Report) is a healthcare services company. The company's outpatient delivery model is focused on providing solutions for surgical and related ancillary care to patients and physicians. Its operating segments include Surgical Facility Services, Ancillary Services, and Optical Services.
Sporting Goods, Hobby, Musical Instrument
Sporting goods, hobby, musical instrument, book, and miscellaneous retailers added 10,000 jobs in July. Retail trade employment has shown little net change over the past year. Apart from the sporting goods and hobbies industry, overall retail trade employment lost 19,000 jobs in July.
State Street SPDR S&P Retail ETF (XRT - Free Report) as some exposure to stocks from the sporting goods, hobby, musical instrument, book, and miscellaneous retailing industries. The fund has gained about 4.5% over the past month.
Zacks Rank #3 (Hold)DICK'S Sporting Goods (DKS - Free Report) operates as a major omnichannel sporting goods retailer, offering athletic shoes, apparel, accessories and a broad selection of outdoor and athletic equipment for team sports, fitness, camping, fishing, tennis, golf, water sports, and more.
View the Zacks #1 Rank List
Image: Bigstock
Likely ETF & Stock Winners From July Jobs Report
Key Takeaways
Nonfarm payrolls fell by a seasonally adjusted 23,000 in July, compared with a downwardly revised 20,000 in June. The Dow Jones consensus forecast had been looking for a gain of 83,000, as quoted on CNBC.
The unemployment rate dipped to 4.1% as the labor force participation rate dropped further to 61.4%, its lowest in more than five years, another indication that fewer Americans were working or looking for jobs.
In addition to the weak June and July figures, May’s final payroll count was revised down to 63,000, or 66,000 lower than the previous estimate. The revisions brought the 12-month average down to just 34,000.
In July, average hourly earnings rose by just $0.02 to $37.62. Over the year, average hourly earnings increased by 3.2%.
Winning ETF Areas in Focus
Health Care
Health care employment has been an area of strength. Health care employment added 22,000 jobs in July. However, job growth slowed from the average monthly gain over the prior 12 months (+36,000). Employment in ambulatory health care services continued to increase during the month.
Health Care Select Sector SPDR ETF (XLV - Free Report) can be played to tap the moderate momentum. The fund has 37% exposure to the pharma industry, followed by 18.8% exposure to the health care equipment & supplies, about 18.4% focus on biotechnology, 16.65% exposure to the healthcare providers & services industry, and 8.8% focus on the life sciences tools & services.
Surgery Partners (SGRY - Free Report) is a healthcare services company. The company's outpatient delivery model is focused on providing solutions for surgical and related ancillary care to patients and physicians. Its operating segments include Surgical Facility Services, Ancillary Services, and Optical Services.
Sporting Goods, Hobby, Musical Instrument
Sporting goods, hobby, musical instrument, book, and miscellaneous retailers added 10,000 jobs in July. Retail trade employment has shown little net change over the past year. Apart from the sporting goods and hobbies industry, overall retail trade employment lost 19,000 jobs in July.
State Street SPDR S&P Retail ETF (XRT - Free Report) as some exposure to stocks from the sporting goods, hobby, musical instrument, book, and miscellaneous retailing industries. The fund has gained about 4.5% over the past month.
Zacks Rank #3 (Hold)DICK'S Sporting Goods (DKS - Free Report) operates as a major omnichannel sporting goods retailer, offering athletic shoes, apparel, accessories and a broad selection of outdoor and athletic equipment for team sports, fitness, camping, fishing, tennis, golf, water sports, and more.