Invesco Building & Construction ETF

PKB

Market cap $298M

Q3 earnings season kicks off with PEP and DAL -- sector ETFs like ITA, XLK, and XLF may gain, while CARZ, PKB and IYT could lag.

The Invesco Building & Construction ETF (PKB) made its debut on 10/26/2005, and is a smart beta exchange traded fund that provides broad exposure to the Industrials ETFs category of the market.

New home sales unexpectedly surged to their highest level in over 3.5 years in August. According to the Census Bureau, new home sales were at a seasonally adjusted annual rate of 800,000 last month.

Looking for broad exposure to the Industrials - Engineering and Construction segment of the equity market? You should consider the Invesco Building & Construction ETF (PKB), a passively managed exchange traded fund launched on October 26, 2005.

While the housing segment has struggled, some small green shoots are emerging. Mortgage rates remain elevated near the mid- to high-6% range, keeping many buyers on the sidelines.

New home sales inched down in July but still came in higher than expected. According to the Census Bureau, new home sales were at a seasonally adjusted annual rate of 652,000 last month.

U.S. equity markets notched another series of record highs this week, surging into the weekend after surprisingly dovish commentary from Federal Reserve Chair Powell, who hinted at imminent rate cuts. Powell used his final Jackson Hole speech as Fed Chair to deliver a clear policy pivot, an unexpected reversal after months of insistence that tariff-related inflation warranted a hawkish framework. Markets were equally relieved by the policy-focused nature of Powell's speech amid speculation that the address may be used instead as a potential defiant sermon on central bank independence.

U.S. equity markets fell sharply this week, while benchmark interest rates retreated to three-month lows, after revised employment data showed that job growth was far weaker than initially reported. The BLS payrolls report showed softer-than-expected hiring in July and the steepest two-month downward revisions to jobs growth since 2020, raising concern that the Fed may be "behind the curve." The downward revisions came days after Fed Chair Powell used it as the primary evidence for "solid" labor markets, which justified the FOMC's decision to keep rates in "restrictive" territory.

PKB aims to offer exposure to firms operating in the construction sector, and has a reasonable track record, though not as strong as the S&P 500. My main concern with PKB is its quant-based equity selection, which results in a high level of concentration, some strange holdings and some absent mega-cap household names. PKB's investment case seems to be also weakened by negligible income, high fees and a high earnings multiple.

New home sales inched up in June but still came in lower than expected. According to the Census Bureau, new home sales were at a seasonally adjusted annual rate of 627,000 last month.