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After a three-day rout triggered by weaker-than-expected jobs data, Wall Street staged a solid comeback as investors bought beaten-down stocks and recession fears eased. All three major indices closed in green, gaining nearly 1% each. All 11 sectors in the S&P 500 were positive for the day.
To tap the beaten-down prices, we have highlighted five ETFs from different corners that have declined over the past week and have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy). These products, namely, Invesco S&P SmallCap Energy ETF (PSCE - Free Report) , U.S. Global Jets ETF (JETS - Free Report) , SPDR S&P Semiconductor ETF (XSD - Free Report) , Range Cancer Therapeutics ETF (CNCR - Free Report) and Invesco S&P SmallCap Information Technology ETF (PSCT - Free Report) are poised to outperform when the market resumes its uptrend.
The batch of last week's data showed weakening labor markets and a slump in manufacturing that spurred recession concerns and battered global stock markets. Though these data signal a slowdown, the U.S. economy is far from recession anytime soon. The latest string of data shows that U.S. services sector activity rebounded from a four-year low in July amid a rise in orders and employment. The ISM survey's new orders measure rebounded to 52.4 from 47.3 in June, which was the lowest since December 2022 (read: 3 Sector ETFs & Stocks to Bet on July Jobs Data).
Investors are betting that the Fed will respond to signs of weakness in the economy with more aggressive interest rate cuts. Per CME Group data, most investors expect larger cuts in the September meeting, with futures implying a 94.5% chance of a half-percentage point cut, up from 74% on Friday and 11% a week ago.
Lower interest rates generally lead to reduced borrowing costs, which help businesses expand their operations more easily, resulting in increased profitability. This, in turn, stimulates economic growth and provides a boost to the stock market.
Investors sentiment has also been lifted by a rebound in Japanese stocks. The Nikkei 225 logged its best day since October 2008, soaring 10.2%. The surge came a day after the benchmark suffered its worst session since 1987, losing 12.4%.
ETFs to Buy
Invesco S&P SmallCap Energy ETF (PSCE - Free Report) – Down 11.8%
Invesco S&P SmallCap Energy ETF offers exposure to companies that are principally engaged in producing, distributing or servicing energy-related products, including oil and gas exploration, and production, refining, oil services and pipelines. It tracks the S&P Small Cap 600 Capped Energy Index, holding 30 stocks in its basket with a modest concentration across firms.
Invesco S&P SmallCap Energy ETF has accumulated $161 million in its asset base and charges 29 bps in annual fees. It trades in an average daily volume of 17,000 shares and has a Zacks ETF Rank #2 with a High risk outlook.
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. The product holds 57 securities and charges 60 bps on an annual basis.
U.S. Global Jets ETF has gathered $973.5 million in its asset base while seeing a heavy trading volume of nearly 2 million shares a day. JETS has a Zacks ETF Rank #2 with a High risk outlook.
SPDR S&P Semiconductor ETF offers exposure to the semiconductor segment of the broader technology sector and tracks the S&P Semiconductor Select Industry Index. It holds 39 stocks in its portfolio. SPDR S&P Semiconductor ETF has AUM of $1.4 billion and an average daily volume of about 52,000 shares (read: Are Semiconductor ETFs Better Bets on AI Boom Than Big Techs?).
SPDR S&P Semiconductor ETF charges 35 bps in fees per year and has a Zacks ETF Rank #1.
Range Cancer Therapeutics ETF (CNCR - Free Report) — Down 9.1%
Range Cancer Therapeutics ETF offers exposure to a wide range of cancer therapeutic modalities. It follows the Range Cancer Therapeutics Index and holds 75 stocks in its basket. Range Cancer Therapeutics ETF has AUM of $13.3 million and charges 79 bps in annual fees.
The fund trades in an average daily volume of 8,000 shares and has a Zacks ETF Rank #2 with a High risk outlook (read: Time for Healthcare ETFs?).
Invesco S&P SmallCap Information Technology ETF (PSCT - Free Report) – Down 8.7%
Invesco S&P SmallCap Information Technology ETF offers exposure to companies that are principally engaged in the business of providing information technology-related products and services, including computer hardware and software, Internet, electronics and semiconductors and communication technologies. It follows the S&P SmallCap 600 Capped Information Technology Index, holding 64 securities in its basket.
Invesco S&P SmallCap Information Technology ETF has an AUM of $308.4 million and charges 29 bps in annual fees. It trades in an average daily volume of 27,000 shares and has a Zacks ETF Rank #1 with a High risk outlook.
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5 Top-Ranked ETFs to Buy at a Bargain
After a three-day rout triggered by weaker-than-expected jobs data, Wall Street staged a solid comeback as investors bought beaten-down stocks and recession fears eased. All three major indices closed in green, gaining nearly 1% each. All 11 sectors in the S&P 500 were positive for the day.
To tap the beaten-down prices, we have highlighted five ETFs from different corners that have declined over the past week and have a solid Zacks ETF Rank #1 (Strong Buy) or 2 (Buy). These products, namely, Invesco S&P SmallCap Energy ETF (PSCE - Free Report) , U.S. Global Jets ETF (JETS - Free Report) , SPDR S&P Semiconductor ETF (XSD - Free Report) , Range Cancer Therapeutics ETF (CNCR - Free Report) and Invesco S&P SmallCap Information Technology ETF (PSCT - Free Report) are poised to outperform when the market resumes its uptrend.
The batch of last week's data showed weakening labor markets and a slump in manufacturing that spurred recession concerns and battered global stock markets. Though these data signal a slowdown, the U.S. economy is far from recession anytime soon. The latest string of data shows that U.S. services sector activity rebounded from a four-year low in July amid a rise in orders and employment. The ISM survey's new orders measure rebounded to 52.4 from 47.3 in June, which was the lowest since December 2022 (read: 3 Sector ETFs & Stocks to Bet on July Jobs Data).
Investors are betting that the Fed will respond to signs of weakness in the economy with more aggressive interest rate cuts. Per CME Group data, most investors expect larger cuts in the September meeting, with futures implying a 94.5% chance of a half-percentage point cut, up from 74% on Friday and 11% a week ago.
Lower interest rates generally lead to reduced borrowing costs, which help businesses expand their operations more easily, resulting in increased profitability. This, in turn, stimulates economic growth and provides a boost to the stock market.
Investors sentiment has also been lifted by a rebound in Japanese stocks. The Nikkei 225 logged its best day since October 2008, soaring 10.2%. The surge came a day after the benchmark suffered its worst session since 1987, losing 12.4%.
ETFs to Buy
Invesco S&P SmallCap Energy ETF (PSCE - Free Report) – Down 11.8%
Invesco S&P SmallCap Energy ETF offers exposure to companies that are principally engaged in producing, distributing or servicing energy-related products, including oil and gas exploration, and production, refining, oil services and pipelines. It tracks the S&P Small Cap 600 Capped Energy Index, holding 30 stocks in its basket with a modest concentration across firms.
Invesco S&P SmallCap Energy ETF has accumulated $161 million in its asset base and charges 29 bps in annual fees. It trades in an average daily volume of 17,000 shares and has a Zacks ETF Rank #2 with a High risk outlook.
U.S. Global Jets ETF (JETS - Free Report) – Down 10.7%
U.S. Global Jets ETF provides exposure to the global airline industry, including airline operators and manufacturers from all over the world, by tracking the U.S. Global Jets Index. The product holds 57 securities and charges 60 bps on an annual basis.
U.S. Global Jets ETF has gathered $973.5 million in its asset base while seeing a heavy trading volume of nearly 2 million shares a day. JETS has a Zacks ETF Rank #2 with a High risk outlook.
SPDR S&P Semiconductor ETF (XSD - Free Report) – Down 10.5%
SPDR S&P Semiconductor ETF offers exposure to the semiconductor segment of the broader technology sector and tracks the S&P Semiconductor Select Industry Index. It holds 39 stocks in its portfolio. SPDR S&P Semiconductor ETF has AUM of $1.4 billion and an average daily volume of about 52,000 shares (read: Are Semiconductor ETFs Better Bets on AI Boom Than Big Techs?).
SPDR S&P Semiconductor ETF charges 35 bps in fees per year and has a Zacks ETF Rank #1.
Range Cancer Therapeutics ETF (CNCR - Free Report) — Down 9.1%
Range Cancer Therapeutics ETF offers exposure to a wide range of cancer therapeutic modalities. It follows the Range Cancer Therapeutics Index and holds 75 stocks in its basket. Range Cancer Therapeutics ETF has AUM of $13.3 million and charges 79 bps in annual fees.
The fund trades in an average daily volume of 8,000 shares and has a Zacks ETF Rank #2 with a High risk outlook (read: Time for Healthcare ETFs?).
Invesco S&P SmallCap Information Technology ETF (PSCT - Free Report) – Down 8.7%
Invesco S&P SmallCap Information Technology ETF offers exposure to companies that are principally engaged in the business of providing information technology-related products and services, including computer hardware and software, Internet, electronics and semiconductors and communication technologies. It follows the S&P SmallCap 600 Capped Information Technology Index, holding 64 securities in its basket.
Invesco S&P SmallCap Information Technology ETF has an AUM of $308.4 million and charges 29 bps in annual fees. It trades in an average daily volume of 27,000 shares and has a Zacks ETF Rank #1 with a High risk outlook.