US Sector Update: Friday, October 19, 2012

The equal weighted sectors are very segmented, as you see four sectors - Telecom, Financials, Healthcare and Consumer Discretion - all substantially outperforming the S&P 500 Equal Weighted Index (as seen in the table below).  Their gains for the last 12 months have all been above 22%, while the other six sectors have moved up in a range from 6% to a high of 17%.  That is a big differential between the top and the bottom.
 
 
In the table above, we also find that Healthcare has gained in the recent one week and the latest month.  However, because this sector is a "political football," we are likely to see Healthcare continue to oscillate.  Also, it is encouraging to see the economically sensitive Basic Materials and Industrials sectors perk up.  However, we'll have to keep a close eye on these sectors, since they've most recently been in a downtrend of relative strength.
 
Don Hays, Nicholas Warf & Justin Wood
 
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