Further to my recent comments in The Energy and Materials Rally, I thought it might be interesting to show the relative performance of the financial sector (XLF) versus the SPX. The chart below shows that while the financials helped to drag down the SPX over the past six months or so, it also reveals that any gains that the SPX has been able to make over the past 2-3 weeks have been without the participation of the financial sector.
I am of the opinion that while the technology (XLK) and industrial (XLI) sectors can provide leadership in any bull move up from current levels, such a move will be severely hampered and likely short-lived without the participation of the financial (XLF) and consumer discretionary (XLY) stocks.
I know your expertise on this. I must say we should have an online discussion on this. Writing only comments will close the discussion straight away! And will restrict the benefits from this information. Ottawa Chartered Professional Accountant
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