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5 Sector ETFs to Sizzle on Upbeat October Jobs Data

URI vs. SSD: Which Stock Is the Better Value Option?

U.S. employers added 250,000 new jobs in October, after a downwardly revised 118,000 in September. The number breezed past market expectations of 190,000. Investors should also note that the data for August was revised up from +270,000 to +286,000. Taking all revisions, job gains have averaged 218,000 over the past three months.

The unemployment rate fell further to 3.7% last month. Average hourly earnings rose by 5 cents to $27.30. Over the year, average hourly earnings increased 3.1%.

Winning Sector ETFs

Against this backdrop, investors should bet on ETFs that are the largest beneficiaries of the October jobs data report. Below we have highlighted some of these that will likely see smooth trading in the days ahead.


Last month, manufacturing employment grew by 32,000, courtesy of a gain in durable goods industries. There was a special uptick in the transportation equipment space (+10,000). Manufacturing has created 296,000 jobs over the year.

Plus, the Trump administration is now eyeing infrastructure reform. All these factors make Invesco S&P SmallCap Industrials Portfolio PSCI a timely investment. The fund targets small-cap companies from industrial products and services, including engineering, heavy machinery, construction, electrical equipment, aerospace and defense and general manufacturing.

Health Care

Jobs in the health care sector grew by 36,000 in the month, wherein nursing and residential care facilities and hospitals added a respective 8,000 and 13,000. Employment in ambulatory health care services went up by 14,000. Per tradingeconomics, health care employment rose by 323,000 over the past year.

This trend puts the spotlight on First Trust Health Care AlphaDEX Fund FXH. The fund has considerable exposure to Health Care Providers & Services and Health Care Equipment & Supplies. Biotechnology also has substantial focus on this fund. The fund has a Zacks Rank #2 (read: Want to Tap Merger Mania? Play Top-Ranked Health Care ETFs).


Per tradingeconomics, about 30,000 jobs were created in the construction sector in the month. Over a year, the sector has generated about 330,000 jobs. Obviously, such upbeat data makes us keep Invesco Dynamic Building & Construction ETF PKB on the radar.  The underlying index of the fund picks building and construction stocks on the basis of factors like growth, stock valuation and investment timeliness.


There were 25,000 job additions in Transportation and warehousing in October. Within the industry, couriers and messengers saw 8,000 job growth and warehousing and storage saw another 8,000 additions. Year over year, employment in transportation and warehousing rose by 184,000. This puts the spotlight on iShares Transportation Average ETF IYT and First Trust Nasdaq Transportation ETF FTXR.

Leisure & Hospitality

Hurricane Florence kept the space under pressure in September. Nevertheless, it added 42,000 jobs in October. This puts Invesco Dynamic Leisure and Entertainment ETF PEJ in focus.

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ISHARS-TRAN AVG (IYT): ETF Research Reports
PACIFIC (EX: JA (PEJ): ETF Research Reports
PWRSH-DYN BLDG (PKB): ETF Research Reports
PWRSH-SP SC IND (PSCI): ETF Research Reports
FT-HEALTH CARE (FXH): ETF Research Reports
FT-NDQ TRANSPRT (FTXR): ETF Research Reports
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