The U.S. manufacturing sector is showing signs of recovery, despite challenges like rising costs and a tight labor market. Industrial production surged 0.7% in January, beating expectations, with the ISM Manufacturing Index hitting 52.6. Inflation has eased, prompting the Fed to keep rates unchanged at 3.5% to 3.75%. Further rate cuts are possible if inflation continues to cool.

Investors may benefit from mutual funds like Fidelity Select Automotive Portfolio (FSAVX) and Fidelity Select Defense & Aerospace Portfolio (FSDAX) with significant exposure to the manufacturing sector. These funds have positive returns over the past three and five years, with expense ratios below the category average. The minimum initial investment is $5000.

FSAVX focuses on companies in automobile manufacturing, while FSDAX invests in defense and aerospace industries. Both funds have a history of positive total returns and seek capital growth. FSDAX has returned 27.8% and 20.8% over the past three and five years, respectively, with an expense ratio of 0.64%.

Investors can receive key mutual fund information and top-performing fund updates through Zacks’ free Fund Newsletter. The newsletter provides insights into top news, analysis, and mutual funds, with expert stock picks expected to double by +100% or more in the months ahead. Previous stock recommendations have soared +171%, +209%, and +232%.

For the latest stock recommendations and to download the 7 Best Stocks for the Next 30 Days, investors can access Zacks Investment Research. Zacks offers free reports on funds like FSDAX and FSAVX for in-depth fund analysis. The article was originally published on Zacks Investment Research’s website.

Read more at Nasdaq: 2 Mutual Funds to Buy on Solid Rebound in Industrial Production