The S&P TSX Composite Index is up sharply in trading today as investors’ sentiment has been boosted by measures announced from the European Central Bank (ECB). The recent recovery in Canadian equities has pushed the S&P TSX into positive territory for the year. However, the index is still down more than 8% from this time last year.
As Canadian equities have struggled over the last year due to weakness in the economy, the appeal of consumer staples and utilities sector has increased. This is because the two sectors are seen as recession-proof. Investors can get exposure to both sectors through ETFs such as iShares S&P/TSX Capped Consumer Staples Index Fund (TSX: XST) and iShares S&P/TSX Capped Utilities Index Fund (TSX: XUT).
XST seeks to provide long-term capital growth by replicating the performance of the S&P/TSX Capped Consumer Staples Index. The ETF’s top holdings include Alimentation Couche-Tard Inc. (TSX: ATD.B) and Loblaw Companies Ltd. (TSX: L). XST has gained more than 17% over the last one year.
XUT seeks to provide long-term capital growth by replicating the performance of the S&P/TSX Capped Utilities Index. The ETF’s top holdings include Fortis Inc. (TSX: FTS). The ETF has gained more than 7% this year.
