NEW YORK (TheStreet) -- The U.S. economy grew by 2% in the third quarter and business activity accelerated in October, signs that corporate and consumer spending are holding up providing positive price support for the iShares Dow Jones US Industrials (IYJ), the Vanguard Materials ETF (VAW) and the PowerShares DB Base Metals (DBB) funds.
According to the latest data from the Institute for Supply Management, economic expansion is at the forefront illustrated by its business barometer reading of a 60.6. Furthermore, data suggests that output climbed at the fastest pace in the third quarter as companies are upgrading equipment and boosting output to meet enhanced increased foreign and domestic demand.
The momentum behind this uptrend in manufacturing and industrials has been driven by improved capital investment, increases in output of business equipment and increases in consumer and investor confidence. As nations continue to recover, it appears that manufacturing and industrials likely will remain at the forefront of economic growth.
The three ETFs previously mentioned are directly correlated with the economic expansion:
- iShares Dow Jones US Industrials, which boasts industrial conglomerate General Electric (GE) as its top holding and closed at $47.11 on Friday;
- Vanguard Materials ETF, which holds copper giant Freeport-McMoRan (FCX) and industrials giant Dow Chemical (DOW) as top holdings. VAW closed at $75.65 on Friday;
- PowerShares DB Base Metals, which enables one to gain exposure to copper, aluminum and zinc, all metals that are expected to continue to witness insatiable demand around the world. DBB closed at $22.75 on Friday.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV