EB Daily Market Report - Special Industry Report - Thursday, March 7, 2024
Before I look at industry groups, I do want to mention that the S&P 500 set another all-time high this morning as it hit 5155.37 just before 11:00am ET.
I'm always looking to follow changes in asset class, sector, and industry group rotation, so I thought I'd focus on industry groups and provide you an update of industry groups that have reversed to the upside off a downtrend or perhaps broken out above key resistance, all while keeping a close eye on relative strength vs. the benchmark S&P 500. Here's an industry group in 4 of the 5 aggressive sectors that appear to me to be benefiting from 2024 rotation (there are none in the XLC):
- Technology (XLK): Electronic components & equipment ($DJUSEC)
- Consumer Discretionary (XLY): Specialty retail ($DJUSRS)
- Communications Services (XLC): None
- Industrials (XLI): Commercial vehicles & trucks (DJUSHR)
- Financials (XLF): Banks ($DJUSBK)
Here are how these 4 industry groups look on an RRG chart relative to the S&P 500 over the past 3 months:
The bottom part of this chart shows how much each industry group has risen over the past 3 months and the S&P 500's gain is shown just beneath them. Keep in mind this exercise ignores groups that have been trending higher on both an absolute and relative basis for many, many months. I'm simply looking for areas within the aggressive groups that are beginning to show nice relative strength.
Here are the SharpCharts for each of the four industry groups showing their absolute price charts and strength:
$DJUSEC:
$DJUSRS:
$DJUSHR:
$DJUSBK:
I added a second year to the DJUSBK chart, so that you can see the significance of the price breakout.
I'm expecting to see continuing relative strength in these 4 industries. Therefore, consider stocks from these 4 industry groups represented in our various ChartLists as possible trading candidates for the foreseeable future.
Happy trading!
Tom