U.S. Markets closed

Consumer Staples' ETFs Hitting New Highs

Sweta Killa

Being defensive in nature, the consumer staples sector has been on a tear this year. The space is home to a variety of items like food & beverages, non-durable household goods, hypermarkets and consumer supercenters that are essential for daily needs. These products see steady demand even during an economic downturn due to their low level of correlation with economic cycles.

As such, these generally act as a safe haven amid political and economic turmoil. Stocks in these sectors generally outperform during periods of low growth and high uncertainty.

And guess what? Trade dispute and geopolitical tensions have led to strong growth in the sector. Though uncertainty surrounding the U.S.-China trade deal has been lingering through the year, the new tariff drama has made investors jittery heading into the busiest holiday season (read: Safe-Haven ETFs Back in Demand on Trade Gyrations).  

This is especially true as President Donald Trump is planning to restore tariffs on steel and aluminum imports from Brazil and Argentina, and proposed tariffs of up to 100% on $2.4 billion worth of French products. Also, trade talks between Washington and Beijing have stalled as Trump said that he will wait until the November 2020 election to strike a deal. The President previously touted that he will impose tariffs on Chinese goods from Dec 15, as announced, if the deal is not reached. This has dented hopes of ending the year-long trade war, resulting in risk-off sentiments.

Additionally, rounds of downbeat data lately signal that economic growth is slowing, thereby raising the appeal for consumer staples stocks. The U.S. manufacturing sector contracted for the fourth straight month in November with a steep drop in new factory orders. U.S. construction spending also unexpectedly fell in October as investment in private projects tumbled to its lowest level in three years.

That said, we have highlighted a few consumer staples ETFs that hit new one-year highs in the last trading session. Any of the following funds could be excellent picks for investors seeking to benefit from the defensive flight. All these products carry a Zacks ETF Rank #1 (Strong Buy) or 3 (Hold):

Consumer Staples Select Sector SPDR Fund XLP: 52-Week High - $62.49

This is the most popular consumer staples ETF with AUM of $13.3 billion and follows the Consumer Staples Select Sector Index. The fund charges 13 bps in fees per year from investors and trades in heavy volume of nearly 13 million shares a day. In total, the fund holds about 33 securities in its basket. From a sector perspective, beverages takes the largest share at 25.4% while household products, food and staples retailing, and food products account for a double-digit allocation each. XLP has a Zacks ETF Rank #1 (Strong Buy) with a Medium risk outlook (read: Fearing a Replay of December 2018? ETF Strategies to Try).

Vanguard Consumer Staples ETF VDC: 52-Week High - $159.31

This fund manages a $5.4 billion asset base and has exposure to a basket of 89 consumer stocks by tracking the MSCI US Investable Market Consumer Staples 25/50 Index. It charges a fee of 10 bps per year and trades in a good volume of around 115,000 shares per day on average. The product is widely spread across household products, soft drinks, packaged foods & meat, and hypermarkets & super centers that make up for a double-digit allocation each. The fund has a Zacks ETF Rank #1 with a Medium risk outlook.

Fidelity MSCI Consumer Staples Index ETF FSTA: 52-Week High - $37.29

This fund tracks the MSCI USA IMI Consumer Staples Index, holding 90 stocks in its basket. It is widely diversified across beverages, household products, food and staples retailing, food products, and tobacco. The ETF has amassed $561.1 million in its asset base, while trading in moderate volume of around 131,000 shares a day on average. It charges 8 bps in annual fees from investors and has a Zacks ETF Rank #1 with a Medium risk outlook.

First Trust Consumer Staples AlphaDEX Fund FXG: 52-Week High - $49.41

This ETF provides exposure to 36 consumer staples stocks by following an AlphaDEX methodology and ranks stocks in the space by various growth and value factors, thereby eliminating the bottom-ranked 25%. About half of the portfolio is allocated to food & tobacco followed by food & drug retailing (23.5%), beverages (13%) and personal household products & services (8.6%). The fund has amassed $311 million in its asset base and sees a moderate volume of 72,000 shares a day on average. Expense ratio comes in at 0.64%. The product has a Zacks ETF Rank # 4 (Sell) with a Medium risk outlook (read: all the Consumer Staples ETFs here).

Invesco S&P 500 Equal Weight Consumer Staples ETF RHS: 52-Week High - $143.70

This fund tracks the S&P Equal Weight Consumer Staples Index, holding 33 stocks in equal weights. Food products takes the largest share at 39.9% while beverages, food & staples retailing, and household products round off the next three spots with double-digit exposure each. The ETF has amassed $506.5 million in its asset base and trades in average daily volume of 29,000 shares. It charges 40 bps in annual fees and has a Zacks ETF Rank #3 with a Medium risk outlook.

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 >>
 

  • What's the Average 401(k) Balance by Age?
    Business
    Investopedia

    What's the Average 401(k) Balance by Age?

    It can be hard to determine exactly how much you'll need for your own post-career days, but finding out how others are planning—or not—can offer a benchmark for setting goals and milestones. k) Plan Balances by Generation The good news is that Americans have been making an effort to save more. According to Fidelity Investments, the financial services firm that administers more than $7.4 trillion in assets, the average 401(k) plan balance reached $106,000 in the second quarter of 2019.

  • 42% of people say this is why they aren't investing in the stock market
    Business
    Yahoo Finance

    42% of people say this is why they aren't investing in the stock market

    A recent JPMorgan Chase survey of about 1,200 investors and non-investors says it boils down to liquidity. The survey found that 42% of those who weren't investing yet were staying out of the stock market because they believed they didn't have enough money to invest. Kelli Keough, digital wealth management head at JPMorgan Chase, tells Yahoo Finance's “The First Trade” non-investors, those who are not in the stock market, say it's a struggle to save enough money to invest.

  • 3 “Strong Buy” Biotech Stocks That Can Inject a Healthy Dose of Upside
    Business
    TipRanks

    3 “Strong Buy” Biotech Stocks That Can Inject a Healthy Dose of Upside

    To watch Selvaraju's track record, click here) The Street appears equally confident in IMMU's future potential; 4 Buy ratings add up to a Strong Buy consensus rating. With an average price target of $28, the analysts believe Immunomedics can add 47% to its share price over the coming year. See Immunomedics stock analysis on TipRanks) Revance Therapeutics (RVNC) After a disappointing 2019, which saw Revance's share price drop by more than 18%, the neuromodulator-focused biotech has started 2020 with a bang; Revance stock is up by 38% year-to-date.

  • Value stocks are making a comeback, and here’s how to get in early
    Business
    MarketWatch

    Value stocks are making a comeback, and here’s how to get in early

    I believe that is unlikely to continue,” says Joel Greenblatt, the co-chief investment officer at Gotham Funds. was the worst year since 1999 for the strategy of buying cheap stocks and shorting expensive stocks (the top quintile for each), Greenblatt says. The last time this strategy experienced such extremely poor results, value put in three great years of performance, from 2000-2002.

  • Will you ‘feel pretty stupid’ holding cash? One trader revisits Ray Dalio’s laughable call and warns of a similar drop
    Business
    MarketWatch

    Will you ‘feel pretty stupid’ holding cash? One trader revisits Ray Dalio’s laughable call and warns of a similar drop

    Almost exactly two years ago, investing legend Ray Dalio turned heads with one of the worst short-term market calls in recent memory. The Bridgewater Associates founder, in an interview at the World Economic Forum back in January 2018, told investors that they were going to “feel pretty stupid” if they were holding cash as stocks climbed toward record highs. So, how stupid did they feel?

  • What interest rates dating back to 1311 tell us about today’s global economy
    Business
    Quartz

    What interest rates dating back to 1311 tell us about today’s global economy

    Interest rates sure are weird these days. Five central banks currently hold policy rates negative; several are dabbling with unconventional bond-buying. The one bank that tried to raise them, the Federal Reserve, found itself back cutting rates within a year.

  • Tesla moves a step closer to opening first European factory with German property deal
    World
    Reuters

    Tesla moves a step closer to opening first European factory with German property deal

    U.S. electric car pioneer Tesla has agreed to buy a property on the outskirts of Berlin, bringing it a step closer to opening its first European factory, local authorities said on Sunday. The U.S. carmaker last November announced plans to build a giant factory in Gruenheide, in the eastern German state of Brandenburg, giving it the coveted "Made in Germany" label just as local rivals prepare to launch competing models. Tesla's board of directors approved a purchase agreement with the state of Brandenburg on Saturday to acquire a 300-hectare property, Brandenburg government spokesman Florian Engels said in a statement.

  • Business
    Oilprice.com

    Is This The End For Big Oil Dividends?

    The largest publicly-traded oil companies in the world have been “living beyond their means” for years. Since 2010, the five largest oil majors have spent vastly more than they have generated when including shareholder payouts. ExxonMobil, BP, Chevron, Total, and Royal Dutch Shell have dished out a combined $536 billion in dividends and share buybacks since 2010, a figure that far exceeds the $329 billion in free cash flow over the same period, according to a new report from the Institute for Energy Economics and Financial Analysis (IEEFA).

  • Dramatic video, truck crashes offroad near trooper
    U.S.
    Associated Press Videos

    Dramatic video, truck crashes offroad near trooper

    Officials in the US state of Iowa are urging people to use caution and stay indoors if possible as blizzard conditions continued to wreak havoc in northern and central parts of the state on Saturday. Jan.

  • Business
    Benzinga

    Barron's Picks And Pans: Apple, Boeing, Disney, Tesla And More

    Barron's Roundtable panelist Rupal Bhansali's makes a case that Apple Inc. NYSE: AAPL) is disadvantaged on many fronts and trying to play catch-up in "Time to Short Apple, Says Rupal Bhansali. Yes, Short Apple."

  • From a U.S. stock surge to a bursting of China’s triple bubble, here are 10 possible shockers for 2020, according to Credit Suisse
    Business
    MarketWatch

    From a U.S. stock surge to a bursting of China’s triple bubble, here are 10 possible shockers for 2020, according to Credit Suisse

    Three weeks into the new year and there really haven't been that many surprises. Stocks keep reaching new records, and companies with what one could charitably say are elevated valuations, like plant-based food company Beyond Meat and car maker Tesla, are back in fashion. A brief flare-up of tensions in the Middle East seems to have been quickly relegated to history.

  • 3 Monster Growth Stocks That Can Rip Higher in 2020
    Business
    TipRanks

    3 Monster Growth Stocks That Can Rip Higher in 2020

    The impressive share gains are bolstered by a strong financial performance. MTZ last reported earnings at the beginning of November, and easily beat the EPS forecasts and the year-ago numbers. For revenue, MTZ reported $2.02 billion, which missed the forecast but was still up 2% year-over-year.

  • Should Your Required Minimum Distribution Be in Cash?
    Business
    Investopedia

    Should Your Required Minimum Distribution Be in Cash?

    Should you take your RMD by getting the cash or transferring the stock to another account? According to Michael J. Garry, managing member and chief compliance officer at Yardley Wealth Management, it doesn't matter for tax purposes. "There is usually little, if any, tax efficiency added by taking in-kind distributions instead of cash.

  • Business
    Barrons.com

    Big Buys of Intel, AT&T, and Facebook Stock by Norway’s Biggest Bank

    Norway's largest financial-services group, DnB, made some big changes in its U.S.-traded stock investments in the last quarter of 2019. DnB more than tripled its investment in (INTC) stock (ticker: INTC) and cut its investment in rival (AMD) (AMD) nearly in half. The bank also bought substantially more (T) stock (T) and (FB) stock (FB).

  • Top Tips to Reduce Required Minimum Distributions
    Business
    Investopedia

    Top Tips to Reduce Required Minimum Distributions

    Holders of individual retirement accounts (IRAs), 401(k)s, and other qualified retirement accounts are required to take distributions from those accounts beginning at age 72. These required minimum distributions (RMDs) force the account holder to take a taxable distribution based on the account balance at the end of the prior year and their age. The logic behind requiring distributions is that the government wants to collect taxes for all of that tax-deferred growth (as well as the original tax-deferral) and that the investor will likely be in a lower tax bracket during retirement.

  • Business
    Oilprice.com

    China’s Cheap Electric Vehicles Could Disrupt Global Markets

    While Western automakers race to capture market share in the world's biggest electric car market, China, hundreds of Chinese electric vehicle (EV) makers have sprung up in recent years to snag a piece of the EV pie too. Government support to the Chinese EV industry and China's ambitions to have new energy vehicles (NEVs) sales account for a quarter of car sales in 2025 means that the Chinese authorities want the EV industry in the country to flourish—and some think this ambitious target would require both Western and Chinese EV makers. Western analysts, however, warn that a Chinese EV oversupply could lead to cut-price exports of China's electric cars, potentially distorting and pressuring the auto industries in other countries, and potentially setting the stage for the next U.S.-China trade war front—electric vehicles.

  • SpaceX Launches and Destroys Rocket in Astronaut Escape Test
    Science
    Meredith Videos

    SpaceX Launches and Destroys Rocket in Astronaut Escape Test

    SpaceX completed the last big test of its crew capsule before launching astronauts in as little as two months, mimicking an emergency escape shortly after liftoff Sunday.

  • ‘I’m 22 with $70,000 in savings and investments, but I’m addicted to checking my brokerage accounts multiple times a day’
    Business
    MarketWatch

    ‘I’m 22 with $70,000 in savings and investments, but I’m addicted to checking my brokerage accounts multiple times a day’

    I do not want to live like that. I am addicted. I check my brokerage accounts multiple times a day and my mood is greatly affected by how the markets are doing.

  • Oil Jumps After Unrest Hits Key OPEC Producers Libya and Iraq
    World
    Bloomberg

    Oil Jumps After Unrest Hits Key OPEC Producers Libya and Iraq

    Oil jumped as rising tension in the Middle East and North Africa halted output and exports from key OPEC producers Iraq and Libya. Futures in New York and London rose more than 1.5%. Iraq temporarily stopped output at an oil field on Sunday and supply from a second site is at risk as widespread unrest escalates in OPEC's second-biggest producer.

  • America Is Awash With Natural Gas and It’s About to Get Worse
    Business
    Bloomberg

    America Is Awash With Natural Gas and It’s About to Get Worse

    One chilly day in October, President Donald Trump boarded Air Force One and flew to Pennsylvania to hail one of the state's most important industries -- not coal, but natural gas. Trump spoke an industry event of the “astonishing increase” in shale gas production. The Appalachian region has spearheaded a historic expansion, turning the U.S. into the world's biggest producer while slashing prices for consumers and sounding the death-knell for domestic coal.

  • Will Roth IRA Withdrawals Be Taxed in the Future?
    Business
    Investopedia

    Will Roth IRA Withdrawals Be Taxed in the Future?

    Today, they offer some of the best tax advantages of any retirement account. The fear exists that Roth IRA withdrawals might somehow be taxed in the future. Under current tax law, you can withdraw Roth contributions and their accumulated earnings tax-free as long as you're at least age 59 ½ and it has been at least five years since you first contributed to a Roth IRA.

  • Man who made a killing during financial crisis says that, at some point, the stock market will slow down — but, till then, ‘I love riding a horse that’s running’
    Business
    MarketWatch

    Man who made a killing during financial crisis says that, at some point, the stock market will slow down — but, till then, ‘I love riding a horse that’s running’

    The U.S. stock market has enjoyed a nearly uninterrupted assault on records, highlighted by the Dow Jones Industrial Average (DJIA) closing at a milestone above 29,000 for the first time and the S&P 500 (SPX) achieving its own landmark close above the psychological round-number at 3,300, while investors in the Nasdaq Composite Index (COMP) may have their sights trained on 10,000.

  • The odds aren’t in stock-market investors favor, says billionaire Howard Marks
    Business
    MarketWatch

    The odds aren’t in stock-market investors favor, says billionaire Howard Marks

    Legendary investor Howard Marks likes to analyze probabilities and he's determined that when it comes to the stock market, chances of healthy, future returns are falling, he said in an interview with Bloomberg Television. In the Tuesday interview, Marks equated buying financial assets to games of chance like poker or Black Jack, where results are determined by “skill, luck, and hidden information.” He made a similar comparison in a quarterly report to investors.

  • Ocasio-Cortez sums up inequality in 5 words after Dow breaks through 29,000
    Business
    MarketWatch

    Ocasio-Cortez sums up inequality in 5 words after Dow breaks through 29,000

    That's “inequality in a nutshell,” according to Rep. Alexandria Ocasio-Cortez, who fired off those words in a tweet response to NBC's coverage of a fresh high for the Dow Jones Industrial Average (DJIA)on Friday. The New York Democrat was making the point that while the blue-chip index rallied more than 20% last year, U.S. average hourly earnings gained less than 3%. And since stocks are generally held by those with higher wealth levels, the data would support her “rich getting richer” stance.

  • Dow Jones Futures: Stock Market Rally Faces Next Test; Netflix, Texas Instruments Earnings Due
    Business
    Investor's Business Daily

    Dow Jones Futures: Stock Market Rally Faces Next Test; Netflix, Texas Instruments Earnings Due

    Dow Jones futures edged lower Sunday night, along with S&P 500 futures and Nasdaq futures. Earnings season is the next big test for the fast-running stock market rally, with Netflix stock and Texas Instruments stock in focus Tuesday night. The stock market rally has run on optimism for stronger growth in 2020 from Apple, FANG stocks Facebook, Amazon.com, Netflix and Google-parent Alphabet and a broad chip industry recovery.