Consumer Discretionary Select Sector SPDR Fund ETF (NYSEARCA:XLY) which tracks S&P 500 consumer discretionary companies rose just 3.99% YTD, lagging behind the broader S&P 500 index which rose 15.51%.
Consumer Discretionary Select Sector SPDR Fund ETF also just rose 10.56% this year, compared to a ~10.66% rise in the S&P 500.
Royal Caribbean Group (RCL) saw the biggest growth in the S&P 500 consumer discretionary index, rising about 14.6% and International Paper (IP) came in second, rising nearly 10.17%.
Industries Q2 performance
Within discretionary, the Automobiles & Components industry declined 16.36% YTD while, Retailing industry added 20.77% and Consumer Services gained 2.89%.
The consumer discretionary-focused ETF had a net flow of -$692.8M in the quarter.
Top 5 S&P 500 consumer discretionary performers in Q2:
Royal Caribbean Group (RCL) +14.60%.
International Paper (IP) +10.17%.
Amazon.com (AMZN) +9.74%.
Tesla (TSLA) +9.74%.
The TJX Companies (TJX) +9.34%.
Bottom 5 S&P 500 consumer discretionary performers in Q2:
Ulta Beauty (ULTA) -24.9%.
LKQ (LKQ) -21.9%.
Bath & Body Works (BBWI) -21.3%.
Lululemon Athletica (LULU) -20.9%.
Mohawk Industries (MHK) -16.2%.
What Analysts Expect
FTS Research analyst suggests, “Alternatively, the long-term perspective seems much more positive. The consumer discretionary sector has been resilient and consistently recovered despite periods of economic hardship. As high inflation and interest rates begin to diminish, consumer spending should recover fairly well.”
“If XLY drops to its 52-week moving average or down to the lower rail of its trend channel, that might bring the valuations down enough to see those grades improve.”
Seeking Alpha analysts rating gives Consumer Discretionary Select Sector SPDR Fund ETF a Hold rating, with 3.00 score.
What Quantitative Measures Say
The ETF has a Buy rating from Seeking Alpha’s Quant Rating system with a 3.81 score out of 5 and has a strong liquidity grade of A+ and momentum grade of B+.
Notably, the ratings system sees risk as a threat and assigns the ETF a grade of D in this category.
