Housing markets as well as the labor markets are now showing
signs of slow improvement and the fears of the domestic economy
slipping into recession have subsided. Further many
statements from the Euro-zone policymakers regarding their resolve
to do "whatever it takes" to preserve the monetary union, have
boosted the investor sentiment.
As a result, the market indexes are now near their highest
levels in the last four years. The following table shows the
sector-wise performance using the SPDR ETFs:
|
Sector
|
Ticker
|
YTD Return (%)
|
1 Month Return (%)
|
3 Month Return (%)
|
1 Year Return (%)
|
|
SPDR-Technology
|
XLK
|
20.35
|
7.55
|
9.67
|
30.51
|
|
SPDR-Consumer Discretionary
|
XLY
|
16.12
|
5.10
|
4.52
|
27.74
|
|
SPDR-Financials
|
XLF
|
16.92
|
6.59
|
8.03
|
22.90
|
|
SPDR-Industrial
|
XLI
|
9.16
|
5.32
|
4.78
|
21.70
|
|
SPDR-Healthcare
|
XLV
|
10.87
|
1.75
|
5.34
|
20.11
|
|
SPDR-Consumer Staples
|
XLP
|
9.48
|
2.39
|
4.86
|
17.59
|
|
SPDR-Utilities
|
XLU
|
2.36
|
-1.58
|
3.28
|
11.98
|
|
SPDR-Energy
|
XLE
|
4.67
|
6.21
|
10.57
|
10.37
|
|
SPDR-Materials
|
XLB
|
9.01
|
4.76
|
7.00
|
10.23
|
Technology sector is a big winner this year (thanks to Apple!),
followed by consumer discretionary and financials.
Looking at the one -month returns, technology, financials,
energy, industrial and consumer discretionary sectors outperformed
the broader market. On the other hand defensive sectors like
utilities, healthcare and consumer staples lagged behind.
Recent outperformance by the economically sensitive or so-called
'risk-on' sectors indicates that the investors are now willing to
take on more risk. These sectors had underperformed the defensive
sectors earlier when the fears of a global economic collapse had
driven the investors to the 'safer' sectors.
However, there are still many factors that will keep the market
volatile through the end of the year. Further, global economy is
not improving substantially anytime soon. Thus, a sustainable
rebound by the cyclical sectors appears to be in doubt.
Do you think that the cyclical sectors can continue their recent
outperformance through the end of this year?
SPDR-SP 500 TR (SPY): ETF Research Reports
SPDR-FINL SELS (XLF): ETF Research Reports
SPDR-TECH SELS (XLK): ETF Research Reports
SPDR-CONS DISCR (XLY): ETF Research Reports
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