Despite a moderate recovery in the U.S. economy, investors are skeptical due to global growth worries that have been haunting the markets lately. The Chinese central bank’s sudden move to cut interest rate and devalue its currency in August to prop up growth not only failed to calm investors, but worsened the economic picture worldwide. This global turmoil has also impacted Asian and European markets. The major U.S. indexes – S&P 500 and Dow Jones Industrial Average – are currently yielding negative year-to-date returns. (Read: Apple ETFs–Value Trap or Value Play)

The softened economic data validates the Federal Reserve’s decision to keep interest rates unchanged. Investors now anticipate further delay in a rate hike due to disappointing job figures last week along with low inflation in the U.S.
 
In fact, the economic scenario is not going to improve in the third quarter earnings season. While China issues will lead the market turmoil across the globe, a persistent weakness in the energy sector and strengthening dollar will add to existing concerns.
 
We also note that the consumer spending pattern is changing and consumers are not willing to spend despite benefiting from lower fuel prices and higher wages. While some are busy boosting their savings, some are burdened with higher health care costs and still-tightened credit availability. (Read: Top Ranked Retail ETFs for a Holiday Season Rally)
 
In fact, there are many consumer staple stocks, which are still suffering from continued pressure in the face of limited consumer spending, foreign exchange headwinds and declining unit volumes. Other global issues including potential price wars, a competitive environment, political turmoil in Russia, sluggishness in Japan, and struggle in Europe continue to hinder the financial health of companies.
 
Needless to say, the equity markets have become extremely volatile and the overall economic picture is quite weak.
 
Playing the Sector through ETFs
 
Given the defensive nature of this sector, it will outperform when equity markets are more bearish and underperform when bullish. The ups and downs of the sector due to the U.S. and global exposure can be played with a wide array of ETFs.
 
The ETFs can act as an excellent investment medium for those who wish to take a long-term exposure within the consumer staples sector.
 
For those interested in taking a look at consumer staples, we have highlighted a few ETFs tracking the industry, any of which could be an interesting pick: