After the lackluster eight month, the auto sector rebounded in September amid heavy discounts, higher fleet sales and surging demand to replace hurricane-damaged vehicles. Auto sales rose 6.1% year over year to an annualized 18.57 million units, regaining the momentum in the industry heading into the selling season and setting the stage for a strong end to the year.

Five of the six major American and Japanese automakers reported solid sales growth last month. Toyota Motors (TM - Free Report) led the way with 14.9% growth, followed by sales increases of 11.9% for General Motors (GM - Free Report) , 9.5% for Nissan (NSANY - Free Report) , 8.7% for Ford Motor (F - Free Report) and 6.8% for Honda (HMC - Free Report) . On the other hand, Fiat Chrysler (FCAU - Free Report) sales dropped 10% year over year last month.

Notably, new car sales in the Houston area, the fourth-most populous in the United States, jumped 109% in the three weeks after Hurricane Harvey compared with the three weeks before the storm, according to the car shopping website Edmunds. Incentives averaged a record $4,048 per vehicle last month, according to research firm J.D. Power.

Robust growth was also driven by a strengthening economy with accelerating job gains, rising wages, increasing consumer spending and growing consumer confidence. Additionally, higher demand for pickup trucks and SUVs, a plethora of new models, fuel-efficient and technologically enriched vehicles, and low interest rates added to the strength and should lift car sales in the coming months as well.

Moreover, the auto sector has a solid Zacks Rank in the top 6% and the valuation looks appealing at the current level with a P/E ratio of 13.03, the lowest of all the 16 Zacks sectors, indicating robust growth in the coming months.

The solid data propelled auto stocks higher and spread bullishness in the entire industry across the globe. Given this, many investors may want to jump on to the space to take advantage of the current trends. For them, we have highlighted a few ETFs and stocks from this corner to ride on.

ETFs to Buy

First Trust Nasdaq Global Auto ETF (CARZ - Free Report)

This fund offers a pure play global exposure to 34 auto stocks by tracking the NASDAQ OMX Global Auto Index. It is a large-cap centric fund with higher exposure to the top five firms at nearly 8% share each while the other firms hold no more than 4.15% of assets. In terms of country exposure, Japan takes the top spot at 33.5% while the United States and Germany round off the next two spots with 22% and 18.8% share, respectively. CARZ has a lower level of $18.2 million in AUM and trades in a small average daily trading volume of around 4,000 shares. The product charges 70 bps in fees per year and has a Zacks ETF Rank #2 (Buy) with a High risk outlook.

Stocks to Buy

Meritor Inc. (MTOR - Free Report)

Based in Troy, MI, Meritor is engaged in designing, developing, manufacturing, marketing, distributing, selling, servicing, and supporting integrated systems, modules, and components to original equipment manufacturers (OEMs) and the aftermarket for the commercial vehicle, transportation, and industrial sectors worldwide. The stock has seen solid earnings estimate revision of 28 cents in the past 30 days for this fiscal year with an expected earnings growth rate of 37.94%. It sports a Zacks Rank #1 and has a VGM Style Score of A.

Adient plc (ADNT - Free Report)

Based in Dublin, Ireland, Adient designs, manufatm ctures, and markets a range of seating systems and components for passenger cars, commercial vehicles, and light trucks, including vans, pick-up trucks, and sport/crossover utility vehicles. The stock saw no earnings estimate revision for this fiscal year in the past 30 days and has an expected earnings growth rate of 8.40%. It carries a Zacks Rank #2 and has a VGM Style Score of A.

Dana Inc. (DAN - Free Report)

Based in in Maumee, OH, Dana is a provider of technology driveline, sealing and thermal-management products. The stock saw no earnings estimate revision activity for this year in the past 30 days and has an expected earnings growth rate of 20.10%. It has a Zacks Rank #2 and a VGM Style Score of A.