Stock market rotation has been a pretty big theme this year but you wouldn’t necessarily know it from our sector performance heatmap. Below we show which sectors have the best and worst performances YTD over the course of the year. Three have been outperformers for most of the year: Consumer Discretionary, Health Care, and Technology. Underperformers have been less consistent. Communications Services and Consumer Staples have lagged pretty consistently, but Staples has started to turn itself around. Utilities lagged badly to start the year but is now an outperformer, while Financials started off on good footing but have lagged into the close of the year. The Industrials sector looks similar to the Financials sector — it was in the top half of performers through April before losing steam. At this point in the year, Industrials are one of the weaker sectors in terms of YTD performance.
Another way to show rotating fortunes at the sector level is to use our rolling heatmap of S&P 500 sector performance. As shown below, only two sectors (Utilities, Health Care) are up over the last three months; Communications Services and Real Estate have started to outperform as well. The big laggards are Energy and Materials, which have been falling behind on a rolling 3 month basis for quite some time now.