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U.S. Retail Sales in the Pink: ETFs & Stocks to Play

Sanghamitra Saha
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After gaining 0.8% in March, U.S. retail sales registered a 0.3% sequential rise in April. The reading matched analysts’ expectations. Barring automobiles, gasoline, building materials and food services, retail sales advanced 0.4% in April after an upwardly revised 0.5% uptick in March. On a year-over-year basis, retail sales increased 4.7% in April compared with a 4.9% rise in March (read: 3 Staples ETFs & Stocks to Buy on Retail Sales & Geopolitics).

As many as 9 out of 13 major retail categories exhibited stronger sales in April than the previous month, as per tradingeconomics. Sales at gasoline stations (up 0.8% from 0.3% rise in March), food and beverage stores (up 0.4% from 0.2% rise in March), at gardening and building material stores (up 0.4% from a decline of 1% in March) and clothing stores (up 1.4% versus 0.2% decreases in June) were among the key drivers.

A solid labor market and higher take-home pay amid tax reductions are enhancing Americans' ability to spend and helping them to tide over the sudden spike in fuel costs. U.S. consumer confidence also recoiled in April and rose to a reading of 128.7 from a downwardly revised 127.0 in March. Before that, confidence touched more than a 17-year high of 130.0 in February.

Against this backdrop, we recommend a few ETFs & stocks that can be investors’ favorites.


US Commodity Funds United States Gasoline Fund LP UGA

Gasoline prices are on a tear. Inflation data also gives cues to that. The product soared to the highest level since Hurricane Harvey, courtesy of Trump's exit from the Iran deal (read: 3 Sector ETF & Stocks to Play April Inflation Data).

The underlying index of the fund looks to reflect the changes in the price of gasoline. It charges 75 bps in fees.

Par Pacific Holdings Inc. PARR

The Zacks Rank #2 (Buy) company manages and maintains interests in energy and infrastructure businesses. The stock belongs to a top-ranked (top 30%) Zacks industry and has a VGM score of B.

Building Materials

PowerShares Dynamic Building & Construction Portfolio PKB

Americans’ intension to buy more building materials puts these ETF in focus. The underlying index of the fund consists of stocks of U.S. building and construction companies. The fund charges 63 bps in fees.

Builders FirstSource Inc. BLDR

The Zacks Rank #2 company is a supplier and manufacturer of structural and related building products for residential new construction in the United States. The stock has a VGM Score of B. It comes from a top-ranked (top 44%) Zacks sector.



Higher spending in clothing makes it necessary to focus on a fund that has heavy exposure to apparel retail. The fund XRT has about 25.9% exposure to this segment. Internet & Direct Marketing Retail (15.86%) and Specialty Stores (14.72%) take the next two spots (see all Consumer Discretionary ETFs here).

Nordstrom Inc. JWN

The Zacks Rank #2 company is a leading fashion specialty retailer offering compelling clothing, shoes and accessories for men, women and children. The stocks comes from a top-ranked (top 38%) Zacks industry. And the stock has a VGM Score of A.

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Builders FirstSource, Inc. (BLDR) : Free Stock Analysis Report
SPDR-SP RET ETF (XRT): ETF Research Reports
US GAS FUND LP (UGA): ETF Research Reports
PWRSH-DYN BLDG (PKB): ETF Research Reports
Par Pacific Holdings, Inc. (PARR) : Free Stock Analysis Report
Nordstrom, Inc. (JWN) : Free Stock Analysis Report
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