Planning to “Sell in May?” Here Are 5 ETFs to Buy Instead
From Nasdaq: 2025-05-01 06:45:00
- After a turbulent April, Wall Street braces for a challenging May. Trade tensions, geopolitical issues, and economic concerns loom large. S&P 500 lost 1.8%, Dow Jones down 3.7%, Nasdaq off 0.9%, and Russell 2000 plunged 4% in April.
- U.S. economy contracts by 0.3% in Q1 2025, first decline since 2022. Imports surge ahead of tariffs, dragging down GDP. Despite the contraction, domestic demand remains resilient, with final sales to domestic purchasers up by 3%.
- Private payroll growth slows sharply in April, rising by only 62,000 jobs. Markets react negatively to weak economic data, raising questions about future Fed rate cuts. ETFs like Invesco Aerospace & Defense and iShares Currency Hedged MSCI Japan could provide gains in May.
- Japanese stocks perform well despite rate hikes. Dividends and buybacks increase, reducing cross-shareholdings. The EWJ ETF gains 4.7% in April. Invesco S&P International Developed Low Volatility ETF benefits from global stability and undervaluation compared to U.S. markets.
- Vanguard Communication Services ETF, with exposure to Meta and Alphabet, sees gains despite concerns over ad slowdown and tariff tensions. VanEck MSCI International Quality ETF offers stability with quality stocks. ETFs like QUAL and VOX show gains in a volatile market environment.
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