|Bid||119.42 x 900|
|Ask||119.43 x 1100|
|Day's Range||119.06 - 119.58|
|52 Week Range||91.73 - 124.60|
|PE Ratio (TTM)||N/A|
|Beta (3Y Monthly)||1.20|
|Expense Ratio (net)||0.13%|
Inside the consumer ETFs that are seesawing between trade attacks and retaliations, and changing stances of the U.S. and China governments.
With market volatility returning to the capital markets in a big way following the latest tariff wars between the U.S. and China, traders are looking to the heaviest hitters in technology for short plays. ...
The Home Depot (NYSE:HD) is the largest home improvement retailer. HD stock is viewed as an important tell on several marquee economic data points, including consumer-related and housing numbers.Source: Shutterstock Home Depot stock is the second-largest component in the Consumer Discretionary Select Sector SPDR (NYSEARCA:XLY) behind a company called Amazon (NASDAQ:AMZN). However, Home Depot is a mature consumer cyclical name. As such, it's not as volatile nor as richly valued as some of the growth-ier names in this sector. HD stock trades for less than 19x forward earnings.Up 21.89% year-to-date, Home Depot stock has been one of the steadier members of the Dow Jones Industrial Average, a theme that should continue because the company is not one at the epicenter of the trade tensions between the U.S. and China.InvestorPlace - Stock Market News, Stock Advice & Trading TipsLast month, Guggenheim analyst Steven Forbes noted of HD stock price "that while the shares might seem pricey after their 2019 run, he thinks that same-store sales will increase in the second half of the year, bolstered by strategic investments in the business, giving the rally fresh legs," according to Barron's.The company reports earnings on Tuesday, Aug. 20 with analysts expecting earnings of $3.09 per share, up from $3.05 a year earlier. A Winner in a Shifting Retail EnvironmentAs has been widely noted, the retail industry is experiencing a revolution, one that is likely to result in more store closures over the coming years. That doesn't mean all brick-and-mortar stores will disappear, but the trends at a play in the retail space will ensure the physical stores that remain will likely be those of stronger companies. For a variety of reasons, Home Depot will be one of the remainders (and winners) as retail undergoes a major face-lift."Other catalysts for top-line growth could come from the firm's efficient supply chain, improved merchandising technology, and penetration of adjacent customer product segments (like commercial)," said Morningstar in a recent note. "Expansion of both new (like textiles from the Company Store acquisition) and existing (appliances could grow post-Sears bankruptcy) categories could also drive demand."Home Depot is also a wide-moat company, meaning it poses significant barriers to entry to would-be rivals. Lowes's (NYSE:LOW) is HD stock's big primary competitor, but it hasn't been much of a competition in terms of price action. Over the past five years, Home Depot stock is up more than 150% while Lowe's is higher by just 100%, according to Bloomberg data.Over that same period, HD stock has beaten XLY by a margin of more than 2-to-1, indicating that it has been one of the best large-cap consumer discretionary names not called Amazon over that span. Bottom Line on HD StockPast performance is never a guarantee of future returns, but Home Depot stock can continue being a long-term winner because of the company's excellence in execution, pricing power, wide moat and resilience in the face of rising online retail sales."Home improvement retailers remain one of the best-insulated sectors from e-commerce threats, as the high weight/value ratio of many products prohibit cost-effective shipping and the specialized knowledge base employees offer is difficult to replicate," said Morningstar. "These strengths have helped Home Depot deliver adjusted average returns on invested capital of 31% during the past five years, after the last housing downturn and focusing on its core orange box business."Yes, Home Depot stock is a tad pricey right now, but if its management can boost margins and return on invested capital, the HD stock price may grow into that valuation, muting the expensive nature of it.Todd Shriber doesn't own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on the Trade War Dip * The 5 Highest-Rated Dow Stocks Right Now * 4 Cybersecurity Stocks to Buy for Long-Term Gains The post HD Stock Worth Building Something With appeared first on InvestorPlace.
The last time I reviewed the Sector SPDR ETFs, I said that the rally was coming to an end and it certainly looks like it could be. Why did I make this prediction? I'm not psychic, it wasn't a guess, and I really couldn't care less about the Federal Reserve or trade wars. I thought that the rally was ending because various sector SPDR ETFs were running into resistance and the consumer discretionary sector was due for a pullback because Amazon (NASDAQ:AMZN) was overbought.As someone who traded at various hedge funds over the past 20 years, I can tell you with 100% certainty that the vast majority of moves made by the S&P 500 Index SPDR (NYSE:SPY) have nothing to due with what the so-called experts in the financial media are attributing to.In financial markets, there are certain price levels that are more important than others with regards to the amount of supply and demand that exists at them. In addition, prices are always doing one of 3 things. Going up, going down, or staying the same.InvestorPlace - Stock Market News, Stock Advice & Trading TipsMost moves in the SPYs are caused by the reaction the underlying sectors that make up the S&P 500 make when they get to these levels or the trend changes. For example, if a sector gets to important support while being oversold, it tends to rebound. If it is not oversold, it tends to consolidate and break the level. It has nothing to do with what Jim Cramer is screaming about or what the analysts are saying. * 10 Cyclical Stocks to Buy (or Sell) Now If you want to get insight into the S&P 500 or SPY, you should look at how the various acting. For example, technology led most of the recent rally -- until the end when the consumer discretionary became more important. Different things drive and influence the market at different times.Let's look at some of the sectors to gain some insight into the future direction of the SPY. Financial Sector SPDR (XLF)The Financial Sector SPDR (NYSEARCA:XLF) has broken support at the important $28 level. This level is important because it was support through all of July, after being a resistance level in May.This will probably be the most important sector to watch over the next week or so. If the XLF fail to rebound back above this level it will be a signal that the SPY are going to trend lower.If the XLF continue to head lower, there may be some support around the $26 level. This is because this is where the lows were at the very end of May. Consumer Discretionary Sector SPDR (XLY)The Consumer Discretionary Sector SPDR (NYSEARCA:XLY) has also broken important support. The $121 level was resistance in April and June.One of the things that led the recent rally was the buying of AMZN stock. Amazon is about 20% of this sector, and as I mentioned last time, AMZN stock was the most overbought that it had been in two years. This brought sellers into the market and this made the stock, and the XLYs, go lower. * 10 Stocks to Buy on the Trade War Dip The dynamic here is similar to that of the XLF. If the XLY does not quickly rebound back over the $121 level, it will be another signal that the SPY is going to trend lower. Technology Sector SPDRs (XLK)The Technology Sector SPDR (NYSEARCA:XLK) has also broken its uptrend. If it continues to sell off, there will probably be some short-term support around $79. This is because this level was resistance in April and June. If it breaks, the broader markets will drop because the tech sector is the biggest part of the S&P 500.How does a resistance level become a support level? The investors who sold their stock at $79 thought they made the correct decision to sell when it traded lower. The short-sellers were looking at a profit.Then when it rallied through the $79 level, the sellers think they have made a mistake and decide to buy XLK if it gets back to $79. The short-sellers tell themselves that if they can cover and break even, they will. Those who bought it at $79 believe they made a good decision and tell themselves that they will add to their positions at $79 if they can.Added to this are the professional traders seeking to profit off of a clear level you can see that there are four groups who want to buy XLK at $79. This demand creates a support level. Healthcare Sector SPDR (XLV)The Healthcare Sector SPDR (NYSEARCA:XLV) has been trending lower over the past month. There will probably be some support around the $90 level because it was resistance in May. * 8 of the Most Shorted Stocks in the Markets Right Now If the XLV finds support around $90 and breaks the downtrend, it could stabilize the SPY. The reaction that the XLV makes if and when it gets to $90 will be important to consider. Energy Sector SPDRs (XLE)The Energy Sector SPDR (NYSEARCA:XLE) continues to trend lower.The XLE started its downtrend last month when it failed at resistance around the $64.50 level. This level was resistance in May, and then again in July.A break of the downtrend line here could be a signal that the selloff that has occurred in the SPY may be coming to an end. Industrial Sector SPDR (XLI) The Industrial Sector SPDR (NYSEARCA:XLI) failed at the resistance at the $78.50 level.You don't need to be a market guru or a master trader to see that this level is important. It was resistance at the end of April and in early May. The XLI has also broken its recent uptrend that began in June. Obviously drawing trendlines is an art and not a science, but if you understand what they illustrate you can profit. * 10 Generation Z Stocks to Buy Long When markets are going up, the forces of demand are in control, and when they are trending lower the forces of supply are in control. If they are consolidating or trading sideways, the forces are equal. The breaking of a trendline means that the leadership may be about to change or equalize. The break of the uptrend line here could be an early indication a downtrend is beginning. S&P 500 SPDR (SPY)The S&P 500 SPDR ETF is testing important support. These are some dynamics to consider to gain insight into whether or not this important level will break or hold. Probably the most important thing to watch is how the XLF reacts to the $28 level. If they do not rebound over the next few days, it will be very bearish for the SPY.It is also important thing is how the XLY reacts to the $121 level. If it does not rebound over the next few days and this level becomes resistance, this could also be very bearish for the SPY.The way the XLK reacts to the $79 support level is important as well. If this level breaks, watch out below.I will also be watching to see if the trends in the XLV and XLE continue. A break of these downtrend lines would be bullish for the SPYs.Most of the dynamics that I see are bearish and I do expect the market to start trending lower. Every time the market sells off after a rally, it seems like people forget that markets go down as well as up.Considering the gains that the market has made since early June some profit taking would not be surprising.As of this writing, Mark Putrino did not hold a position in any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy on the Trade War Dip * The 5 Highest-Rated Dow Stocks Right Now * 4 Cybersecurity Stocks to Buy for Long-Term Gains The post 7 SPDR ETFs and What They Tell Us About the Market appeared first on InvestorPlace.
The day after the big swoon looked lackluster. Global investors lost their appetite, while bond yields were down but bond prices were up.
August saw an awful start with global markets in the red mainly due to renewed trade tensions. Such market and ETF activities could rule the market in August.
With market volatility returning to the capital markets in a big way following the latest tariff wars between the U.S. and China, it might make sense to look at exchange-traded funds (ETFs) that are heavy ...
Consumer Staples ETFs have been firing on all cylinders in the past three months, beating their discretionary counterparts. Let's find out what's driving the rally.
As investors weigh on the growth outlook and strength of our economy, defensive consumer staples sector-related ETFs have been outperforming. Over the past three months, the Consumer Staples Select SPDR ...
U.S. GDP growth slows in the second quarter but trumps expectations, indicating still-decent operating environment. This could bode well for these ETF areas.
Amazon’s second-quarter earnings gave investors a mixed bag of things to like along with things to carefully consider before jumping into shares of the online retail giant. The company’s higher revenue ...
As the U.S. government has announced investigation on the largest U.S. tech companies for anti-competitive practices, these FAANG-heavy ETFs thus could suffer ahead.
There was a time when sector exchange-traded funds (ETFs) were widely considered the territory of more sophisticated, tactical investors. But now, thanks in large part to the proliferation of industry and sector ETFs, more advisors and investors are using these products.Yes, sector ETFs still have plenty of applications on a tactical basis. With markets in the midst of another earnings season, short-term traders can tap sector ETFs when a particular group delivers a slew of earnings reports in a condensed time frame, as has been the case with financial services stocks this week.Additionally, investors can tap sector ETFs for longer-term purposes. Say you want to generate income or lower volatility, sector ETFs tracking consumer staples or utilities stocks could make for ideal additions to your portfolio. Likewise, investors wanting to latch onto growth may want to consider positions in dedicated consumer discretionary or technology sector ETFs.InvestorPlace - Stock Market News, Stock Advice & Trading Tips * 10 Stocks to Buy From This Superstar Fund For investors looking for dedicated sector exposure, here are some industry-specific funds to consider. Fidelity MSCI Communication Services ETF (FCOM)Expense ratio: 0.084% per year, or $8.40 on a $10,000 investment.The communication services sector is a mix of growth stocks, such as Facebook Inc. (NASDAQ:FB) and Alphabet Inc. (NASDAQ:GOOG NASDAQ:GOOGL), and old guard telecommunications stocks. However, sector ETFs such as the Fidelity MSCI Communication Services ETF (NYSEARCA:FCOM) are usually heavily allocated to the group's growth fare.For example, Facebook and the two classes of Alphabet stock combine for over 40% of FCOM's weight. This sector ETF and its rivals are worth considering over the near term for multiple reasons. First, Alphabet and Facebook, for varying reasons, are facing considerable Congressional scrutiny and there are efforts to break these and other tech companies up.Second, more than 60% of the communication services sector reports earnings this week. For long-term investors, FCOM has utility as well, including the fact that Fidelity's sector ETF's are the industry's cheapest. Consumer Discretionary Select Sector SPDR (XLY)Source: Shutterstock Expense ratio: 0.13%The Consumer Discretionary Select Sector SPDR (NYSEARCA:XLY) is the oldest and largest sector ETF dedicated to consumer cyclical stocks and has, over the years, risen to acclaim for being an adequate proxy on shares of Amazon.com (NASDAQ:AMZN). That is an accurate assessment as this sector ETF allocates about 23.5% of its weight to Amazon, more than double its second-largest holding.All three of the Dow Jones Industrial Average's consumer discretionary components -- Home Depot (NYSE:HD), McDonald's (NYSE:MCD) and NIKE (NYSE:NKE) -- reside in XLY and combine for over 22% of the fund's weight. * 7 Stocks to Buy This Summer Earnings Season XLY provides exposure to "retail (specialty, multiline, internet and direct marketing); hotels, restaurants and leisure; textiles, apparel and luxury goods; household durables; automobiles; auto components; distributors; leisure products; and diversified consumer services" companies, according to State Street. Global X MSCI China Consumer Discretionary ETF (CHIQ) Source: Shutterstock Expense ratio: 0.65%Let's stick with consumer cyclical stocks for a moment and let the Global X MSCI China Consumer Discretionary ETF (NYSEARCA:CHIQ) serve as a reminder that investors do not need to confine their search for the best sector ETFs to domestic offerings. There are plenty of ex-US sector ETFs on the market and one of the better offerings, at least for risk-tolerant investors, is CHIQ."Among the most powerful are those areas tied to the rising impact of China's consumers, who have experienced years of high wage growth, migration into cities, and an expansion of internet connectivity," said Global X in a recent note. "The government has also made consumption a priority as the economy transitions away from export-led industries."Sure, CHIQ can be seen as the XLY of China and, yes, that is a positive trait. Data confirm as much."China's Consumer Discretionary sector is the country's largest by total market cap, yet it is still just half the size of its US counterpart. This is despite the fact that China's population is four times larger than the US's and is experiencing a rapidly growing middle class, suggesting that the sector is still in its early stages of growth," according to Global X. Health Care Select Sector SPDR (XLV)Source: Shutterstock Expense ratio: 0.13%After ranking as the S&P 500's best-performing sector in 2018, the healthcare sector is the worst-performing group in the U.S. this year. Still, the Health Care Select Sector SPDR (NYSEARCA:XLV) is up more than 6% year-to-date despite a political environment that, at times, feels increasingly hostile toward healthcare stocks.Aside from its defensive traits, there are reasons to consider XLV or related sector ETFs, including these funds being home to some big-name stocks that are expected to lead major U.S. equity benchmarks to new highs. Plus, the sector's 2019 lethargy could be a sign value is emerging in the S&P 500's second-largest sector weight. * 5 Dow Jones Stocks to Sell Before the Market Slumps "A closer look shows that the large drugmakers are holding back the health care sector," reports Investor's Business Daily. "Of the 10 worst-performing stocks in the sector and the XLV ETF, seven are diversified pharmaceutical firms or biotechs. These stocks tend to suffer during years of heavy political activity. Already, several Democratic candidates have put drug prices at the forefront of their campaigns." Invesco S&P 500 Equal Weight Consumer Staples ETF (RHS)Source: Shutterstock Expense ratio: 0.40%Most consumer staples funds, and sector ETFs for that matter, are cap-weighted funds, but investors may able to generate higher returns in the right settings by favoring an equal-weight strategy such as the Invesco S&P 500 Equal Weight Consumer Staples ETF (NYSEARCA:RHS). The obvious difference between RHS and a cap-weighted rival is, well, average market value.The average market capitalization of RHS's 33 holdings is $63.8 billion, but the figure swells to $150.8 billion for biggest cap-weighted consumer staples ETF. In the cap-weighted Consumer Staples Select Sector Index, the largest holding is Procter & Gamble (NYSE:PG) at nearly 16% of the benchmark's weight. Conversely, the top holding in RHS commands barely more than 3% of the sector ETF's roster.Although RHS leans toward smaller stocks, it is not significantly more volatile than competing cap-weighted funds. Invesco S&P SmallCap Information Technology ETF (PSCT)Source: Shutterstock Expense ratio: 0.29%For years, investors have been regaled with tales of exponential returns offered by small-cap technology stocks. However, stock picking in this arena is difficult, making the Invesco S&P SmallCap Information Technology ETF (NASDAQ:PSCT) an appealing options for those seeking small-cap tech exposure.PSCT's 87 holdings have an average market value of $1.83 billion, putting this sector fund at the higher end of small-cap territory. As is to be expected, PSCT is a growth-heavy sector with growth stocks accounting for quadruple the weight assigned to the fund's value fare.While PSCT is not excessively valued compared to broader small-cap ETFs, the sector ETF usually is much more volatile than standard small-cap benchmarks, indicating this fund is more appropriate for risk-tolerant investors. That said, PSCT offers compensation for that elevated volatility because it usually outperforms basic small-cap indexes over longer holding periods. Hoya Capital Housing ETF (HOMZ)Expense ratio: 0.45%Real estate is one of the smallest sector weights in the S&P 500, but despite that diminutive status, the group is well-represented in the ETF space. One of the new offerings on that front is the Hoya Capital Housing ETF (NYSEARCA:HOMZ), which focuses on residential real estate and the related equity investment opportunities.HOMZ follows the Hoya Capital Housing 100 Index, an in-house benchmark designed to provide exposure to various elements of the home-buying process, including home builders, home rental operators, home services and technology firms, and home improvement retailers. The fund, which expects to pay a dividend on a monthly basis, is also levered to the rental theme."HOMZ offers exposure to the companies that own more than a million rental units across the United States including apartments, single family rentals, and affordable housing," according to the issuer. * 7 5G Stocks to Connect Your Portfolio To HOMZ is about four months old and is up nearly 9% since inception.Todd Shriber does not own any of the aforementioned securities. More From InvestorPlace * 2 Toxic Pot Stocks You Should Avoid * 10 Stocks to Buy From This Superstar Fund * 7 Stocks to Buy This Summer Earnings Season * 7 Marijuana Penny Stocks to Consider for Those Who Can Handle Risk The post 7 Great Sector ETFs to Buy for the Short or Long Term appeared first on InvestorPlace.
Amazon's fifth annual Prime Day is gearing up to be another record-breaking event, but it doesn't necessarily deliver outsized returns for investors.