Consumer Staples Select Sector SPDR Fund (XLP)

Apr 8, 2022Trade Ideas

Yesterday, we spoke about NextEra Energy (NEE).

From $85.91, the stock closed at $87.08 on the day. And while we still like the stock here, we have another interesting stock that could benefit from fears of an economic downturn.

Look at the Consumer Staples Select Sector SPDR Fund (XLP), for example.

During downturns, many of us stop going to restaurants, and cut out spending on gadgets. However, we can’t abandon basic needs items such as bread, milk, toilet paper, diapers, and cleaning supplies to name a few. All of which can lead to fairly reliable revenue and strong cash flow, which can also benefit ETFs such as the XLP.

Some of the fund’s top holdings include Procter & Gamble, PepsiCo, Coca-Cola, Costco Wholesale, Altria Group, Walmart, and Colgate-Palmolive.

Better, if the XLP can break above double top around $131, XLP could see higher highs.

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