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In August, total industrial output climbed 0.3% to 5.9%, while industry capacity utilization increased 0.2% to 76.4%, compared to respective pre-pandemic levels. Investor optimism in the sector is evidenced by the Industrial Select Sector SPDR ETF’s (XLI) 14.4% returns year-to-date.
Furthermore, the U.S. House of Representatives is approaching a Monday deadline to vote on a bipartisan infrastructure spending bill, which, if approved, should propel the growth of the industrial equipment market. So, we think it could be wise to bet on industrial equipment stocks Standex International Corporation (SXI), Lawson Products Inc. (LAWS), Preformed Line Products Company (PLPC), and LSI Industries Inc. (LYTS). These stocks are well-positioned to capitalize on the industry tailwinds and deliver solid returns in the near term.
