A strong transportation sector can likewise indicate a strong economy, and that should help boost the Direxion Daily Transportation Bull 3X Shares (TPOR) even further.
The fund is already up over 80% for the year, thanks to its triple leverage. If there’s still room to run in 2022 with an even stronger labor force, TPOR could give traders even more to cheer about.
“Despite facing headwinds like inflation concerns and supply-chain delays, the sector covering trade, logistics/transportation and utilities should recover in 2022 all jobs lost to the pandemic, driven by hiring growth in subsectors like durable goods, couriers, and warehousing, a labor market analysis says,” a DC Velocity article says.
“One reason for that swell of employment is that consumers have been taking advantage of historically low interest rates and using their accumulated savings to make purchases ranging from online shopping to cars, appliances, and furniture, according to the ‘2022 U.S. Job Market Outlook’ report from ThinkWhy, a vendor of cloud-based HR and talent acquisition solutions,” the article adds.
As mentioned, TPOR seeks daily investment results that are equal to 300% of the daily performance of the Dow Jones Transportation Average. The index measures the performance of large, well-known companies within the transportation industry.
A Retail Trader to Consider
Additionally, the DC Velocity article mentions how consumers are back in full force with retail spending. That should also open up opportunities in another fund: the Direxion Daily Retail Bull 3X ETF (RETL), which seeks daily investment results of 300% of the daily performance of the S&P Retail Select Industry Index.
The fund was up over 200% by mid-November before the Omicron variant put a stop to that party. Still, RETL is up over 80% on the year, and there’s still December holiday shopping to complete.
“Despite economic headwinds, November retail sales data confirms that consumers continue to spend, as demonstrated by a 14 percent increase in sales year-over-year,” NRF president and CEO Matthew Shay said in a release. “We expect demand will remain strong through December, even though consumers started holiday shopping earlier than ever this year. Despite the rise of the omicron variant, increased vaccination rates combined with retailers’ ongoing safety protocols and procedures have resulted in consumers who feel they can continue to shop safely and conveniently. We believe that holiday sales this year could grow as much as 11.5% over 2020.”
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