Why You Need Cautious Optimism Here

This video is part of our "Talking Stocks" series, in which Motley Fool analyst Austin Smith discusses trends across the investing universe.

In today's edition, Austin talks about the impressive retail sales numbers from the Commerce Department. The growth is encouraging for the broad market, as February saw the largest sales jump in five months. Austin is still cautiously optimistic about this sector. While he sees true fundamental strengths in many companies, there is still a bit of volatility in the space, making it that much more difficult to identify the winners. In addition, one major reason for the strong retail numbers is that we're coming off a warm winter, which stokes the coals of consumer spending.

When it comes down to it, Austin is waiting for a more meaningful drop in the unemployment rate before he dedicates a larger part of his portfolio to this space. That's just one great reason to invest in an industry like health care, which is less sensitive to employment pops and drops. If you poke around this space enough, you may Discover the Next Rule-Breaking Multibagger. Or we could just save you all the time and research by just giving you this top health-care pick. You can read about this company your copy of our newest free report by clicking here. Enjoy, and Fool on!

At the time thisarticle was published Austin Smith owns none of the companies mentioned here.Motley Fool newsletter serviceshave recommended buying shares of Home Depot and writing covered calls on Lowe's and formerly recommended Lowe's. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.

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