Sectors relative strength

kenwind

   

The chart on the left above is the relative strength of financial stocks to the overall market. In another words, it is the ratio of financial sector ETF to the SPX index. It has been trending down since Apr, i.e. financial stocks drop in a faster fashion than the broad index. Usually, the financial sector leads the market up in a bull market. Obviously, money is leaving this sector and that doesn't bode well for the overall market health.


The chart on the right above is the relative strength of utility sector to the overall market. This is a defensive sector, when fund managers are not optimistic on the equity market, they tend to allocate more money into the high dividend paying sectors, like utilityy, health and staple sectors. The current money flow trend indicates that fund managers are in defensive mode.



The above chart is the relative strength of large caps to small caps. Large caps usually are high and stable dividend companies. Small caps most often are growth and high risk companies. In a risk taking mode, small caps outperforms large caps. However, that is not the case now, the market is in a risk off mode.

southware

谢谢

babyruth

bucks

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falcone

Thanks

xnz

thanks

sooners

回复 1# kenwind


   

MeiTouNao

great. Thanks

AGA7d

Many small caps feed on large caps - so during go-go times, large companies do not watch their wallet that carefully and small caps thrive. Now large caps are cutting the corners which hurt the small ones. That's also the reason that the unemployment is stubbornly high - since small companies are the job engine. This is a structural problem, not a GOP vs demo one.

slowstep