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The year 2019 has been all about peaks and troughs in U.S.-China trade tensions, global growth slowdown and global policy easing. The upshot is at least 19% gains in the key U.S. equity gauges.
SPDRS&P 500 ETF (SPY - Free Report) has added about 23.6% so far this year while Invesco QQQ Trust (QQQ - Free Report) has gained 30.2% and SPDR Dow Jones Industrial Average ETF (DIA - Free Report) has advanced 19%. All-world ETF iShares MSCI ACWI ETFACWI is up 19.8%. While many corners of the market have made solid gains, some sectors delivered even stronger performance.
Below we highlight those winners.
Semiconductor
Occasional hopes of a U.S.-China trade deal, a 5G boom and rising consumer spending on technology have propelled the sector. Expectations of higher smartphone sales have given an added boost. IDC expects the smartphone market to record 1.6% growth in 2020, after three straight years of global contraction. Gartner too expects smartphone sales to grow again in 2020 after a decline in 2019, thanks to “broader availability of 5G models and the promotion of 5G service packages in various parts of the world by communications service providers."
Clean energy ETFs have ridden higher this year. This has happened despite President Trump’s inclination toward booting fossil-fuel energy. Going by an International Energy Agency (IEA) report, worldwide supplies of renewable electricity are expected to expand 50% in the next five years.
Invesco Solar ETF (TAN - Free Report) (up 50.6%), Invesco Exchange-Traded Fund Trust - Invesco WilderHill Clean Energy ETF (PBW - Free Report) (up 44.6%) and ALPS Clean Energy ETFACES (up 41.5%) are some of the ETFs that have added solid gains.
Home Building
Low mortgage rates have worked wonder for housing stocks this year. With the Fed being dovish, this rate-sensitive sector has every reason to outperform. iShares U.S. Home Construction ETF (ITB - Free Report) (up 49.9%), Invesco Dynamic Building & Construction ETF (PKB - Free Report) (up 42.4%) and SPDR S&P Homebuilders ETF (XHB - Free Report) (up 41.7%) are the top-performing homebuilding ETFs (read: Here's Why Homebuilding ETFs Are Soaring).
Aerospace & Defense
President Donald Trump’s repeated pitch for a higher defense budget, rising geopolitical risks and higher commercial demand are giving a boost to defense companies. Invesco Aerospace & Defense ETF (PPA - Free Report) (up 41.2%) and SPDR S&P Aerospace & Defense ETF (XAR - Free Report) (up 41.1%) deserve a mention.
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Market-Beating Sector ETFs Year to Date
The year 2019 has been all about peaks and troughs in U.S.-China trade tensions, global growth slowdown and global policy easing. The upshot is at least 19% gains in the key U.S. equity gauges.
SPDRS&P 500 ETF (SPY - Free Report) has added about 23.6% so far this year while Invesco QQQ Trust (QQQ - Free Report) has gained 30.2% and SPDR Dow Jones Industrial Average ETF (DIA - Free Report) has advanced 19%. All-world ETF iShares MSCI ACWI ETF ACWI is up 19.8%. While many corners of the market have made solid gains, some sectors delivered even stronger performance.
Below we highlight those winners.
Semiconductor
Occasional hopes of a U.S.-China trade deal, a 5G boom and rising consumer spending on technology have propelled the sector. Expectations of higher smartphone sales have given an added boost. IDC expects the smartphone market to record 1.6% growth in 2020, after three straight years of global contraction. Gartner too expects smartphone sales to grow again in 2020 after a decline in 2019, thanks to “broader availability of 5G models and the promotion of 5G service packages in various parts of the world by communications service providers."
SPDR S&P Semiconductor ETF XSD (up 55.1%), First Trust Nasdaq Semiconductor ETF FTXL (up 52.4%), VanEck Vectors Semiconductor ETF (SMH - Free Report) (up 52.3%) and iShares PHLX Semiconductor ETF (SOXX - Free Report) (51.7%) have proven to be the clear winners (read: Time to Buy the Dip in Semiconductor ETFs?).
Clean Energy
Clean energy ETFs have ridden higher this year. This has happened despite President Trump’s inclination toward booting fossil-fuel energy. Going by an International Energy Agency (IEA) report, worldwide supplies of renewable electricity are expected to expand 50% in the next five years.
A transition toward 100% clean electricity is going on in the United States. China is a major player building a green environment. Almost half of the European Union’s (EU) 28 member states have already reached or are about to touch their 2020 renewable energy targets(read: Top-Performing Alternative Energy ETFs YTD).
Invesco Solar ETF (TAN - Free Report) (up 50.6%), Invesco Exchange-Traded Fund Trust - Invesco WilderHill Clean Energy ETF (PBW - Free Report) (up 44.6%) and ALPS Clean Energy ETF ACES (up 41.5%) are some of the ETFs that have added solid gains.
Home Building
Low mortgage rates have worked wonder for housing stocks this year. With the Fed being dovish, this rate-sensitive sector has every reason to outperform. iShares U.S. Home Construction ETF (ITB - Free Report) (up 49.9%), Invesco Dynamic Building & Construction ETF (PKB - Free Report) (up 42.4%) and SPDR S&P Homebuilders ETF (XHB - Free Report) (up 41.7%) are the top-performing homebuilding ETFs (read: Here's Why Homebuilding ETFs Are Soaring).
Aerospace & Defense
President Donald Trump’s repeated pitch for a higher defense budget, rising geopolitical risks and higher commercial demand are giving a boost to defense companies. Invesco Aerospace & Defense ETF (PPA - Free Report) (up 41.2%) and SPDR S&P Aerospace & Defense ETF (XAR - Free Report) (up 41.1%) deserve a mention.
Want key ETF info delivered straight to your inbox?
Zacks’ free Fund Newsletter will brief you on top news and analysis, as well as top-performing ETFs, each week. Get it free >>