US Sector Update: Friday, September 14, 2012

Consumer Discretion is back in the saddle again.  The sector has continued, with very few lapses, to lead the parade since March 2009.  In these last three months, it spent a few weeks dragging on, but in the latest few weeks, it has moved right back out as the most consistent winner of all sectors.
In the latest few weeks, we've also seen two laggards - Energy and Basic Materials - come back to life, but we'll need to wait a few more weeks to see if this move is sustainable.  However, in the charts below, you can see that both the equal weight and market weight Energy sectors have seen some overall improving relative strength since what appears to be sometime in July.
Despite the market weight sectors leading the equal weight sectors in performance for the most part this year, the market weight sectors took a back-seat this past week as their equal weight counterparts saw stronger returns.  However, large-caps have been out of favor for so long, it's pay-back time.  For the US recovery, it's probably good for large-caps to come back to life.
Don Hays, Nicholas Warf and Justin Wood
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