6 Sector ETFs Surviving The Market Rout

Wall Street saw a wild swing last week with the U.S. stocks posting the second consecutive weekly loss. The Nasdaq Composite Index underperformed, shedding 4.1% last week while the S&P 500 and Dow Jones Industrial Average lost 2.5% and 1.7%, respectively.

The volatility is expected to continue in the weeks ahead given elevated valuation concerns and election uncertainty. Rise in U.S.-China trade tensions, delay in the late-stage trial of the leading COVID-19 vaccine candidates from AstraZeneca Plc (AZN - Free Report), and failure to have the new coronavirus aid approved also pushed the bears higher last week.

If we go be history, September is a weak month for the stock market. The seasonal phenomenon took a toll on the stocks as investors are more prone to selling than buying when they return from their summer vacations, trading volume after Labor Day is mostly bearish, many mutual funds have fiscal years ending Sep 30, window-dressing is rampant, and investors generally sell stocks to pay tuition bills for their kids’ private schools and colleges.

However, strong support from the Fed, enthusiasm surrounding a COVID-19 vaccine, and improving economic backdrop will continue to fuel a stock rally.

Amid the uncertainties, a few sectors have survived last week’s turmoil. We have highlighted six of that could be compelling picks for the weeks ahead as long as volatility persists.

The Cancer Immunotherapy ETF (CNCR - Free Report) — Up 4.8%

This ETF offers exposure to a basket of companies that develop therapies to treat cancer by harnessing the body's own immune system. It holds 30 stocks in its basket with each accounting for less than 6% of assets. The fund has AUM of $39.3 million and charges 79 bps in annual fees. The fund trades in average daily volume of 9,000 shares and has a Zacks ETF Rank #3 (Hold) with a High risk outlook.

iShares U.S. Home Construction ETF (ITB - Free Report) – Up 3.8%

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