All the talk coming into this week was that we were entering one of the most statistically bearish weeks of the year, it seemed the markets had no chance before we even started. Well, in the end the markets did end up down in most areas, but it didn’t feel that bearish to me. I could make the argument with this statistic and the headline risk that served as the backdrop for the week, the markets actually held up very well. $SPY and $DIA took the biggest hits with losses a little more than a percent. The $QQQ actually eked out a gain, and the $IWM was flat. The bulls are not charging ahead, but they are holding their ground well. The breadth telling pretty much the same story. Seemed more like consolidation than a rollover. It is also worth noting that those sectors that were showing the most weakness in the breadth readings were traditionally defensive sectors and known to under perform when the markets are doing well. This tells me we could be seeing more rotation from defensive sectors like Utilities, Consumer staples, and Health care to the more offensive ones like Technology, Industrials, and Materials. This makes sense and is probably a little overdue if the economy is continuing to slowly strengthen (which it is).
First, the Total universe of 1898 companies posted over the $SPY
Universe Composite Index
Next I split the universe into 10 custom broad sector indexes
Consumer Discretionary (325)
Consumer Staples (91)
Health Care (199)
These are custom indexes so you cannot invest directly in them, but there are plenty of ETFs available for each sector. For me personally this is another form of relative strength, just with a broader lens .
Good Luck! It is there for you to make.