US ETF Equity Sectors Review | 8 Jan 2015

Utility sector stocks don’t usually excite the crowd, but this corner of the US equity market has shed its dull image lately. Traditionally seen as a safe haven within the broad market, shares of electric and gas utility companies are performing like growth stocks these days.

Thanks to the renewed risk-off bias of late, utilities are comfortably in the lead among the US equity sectors, based on a set of ETFs via trailing one-year total returns through yesterday (Jan. 7). The Utilities Select Sector SPDR (XLU) is up nearly 31% over the past 252 trading days—a sizable edge over the number-two performer, Health Care Select Sector SPDR (XLV), which is ahead by 26%.

As for the red ink club, energy is still its leading member for the trailing one-year period. The Energy Select Sector SPDR (XLE) is down by roughly 12% over the past year. But energy’s misery now has company: the performance for telecom stocks recently slipped below zero for the trailing 252-day period, albeit ever so slightly. Vanguard Telecommunication Services (VOX) through yesterday is down by a few basis points relative to its year-earlier price. As for the market overall, the S&P 500 is ahead by roughly 12% for the trailing one-year period, based on the SPDR S&P 500 (SPY) on a total return basis (red line in chart below).


Here’s how the trailing one-year performance histories stack up when we index all the sector ETFs to 100 as of Jan. 8, 2014. Note the recent acceleration in utilities (black line at top). Meanwhile, the recent rally in energy stocks has succumbed once again to bearish sentiment (purple line at bottom).


Finally, here’s a comparison of recent momentum for the sector ETFs via current prices relative to trailing 50- and 200-day moving averages, as shown in the next chart below. For example, Energy Select Sector SPDR ETF (XLE) closed yesterday at 8% below its 50-day moving average (red square in lower right-hand corner) and nearly 17% below its 200-day moving average (black square in lower right-hand corner).

Here’s a list of the sector ETFs cited above, with links to summary pages at for additional research:

Consumer Discretionary (XLY)
Consumer Staples (XLP)
Energy (XLE)
Financial (XLF)
Healthcare (XLV)
Industrial (XLI)
Materials (XLB)
Technology (XLK)
Utilities (XLU)
Telecom (VOX)