2016 may have gone out like a bear, but 2017 is kicking off bullish. US equities are beginning the year in the green, looking to end what was a three-day losing streak for the S&P 500, DJIA, and Nasdaq to close out 2016; the first such streak since the start of November. So just when you thought they couldn’t go down anymore, the last three days of 2016 served as a reminder that equity performance is in fact a two-way street. But today, the direction is back up as the S&P 500 is set for its first positive day to start a year since 2013.
Looking at sector returns during the last three days of the year, it looked like nothing more than profit-taking as the market’s leading sector (Financials) during the rally was among the laggards, while the three sectors that held up the best were among the biggest laggards during the rally. One sector that stands out is Telecom Services; while it was the second best performing sector during the rally, it was the third best performing sector in the last three trading days of 2016. With just five stocks in the sector, though, we have probably already wasted more than enough ink talking about it.
One significant sector worth talking about, though, is Technology. With a gain of 3.5% post-election, through 12/27, the sector fell close to 2% in the last three days of the year, erasing more than half of its post-election gains. Since the close on 11/8, the only three sectors that have done worse are Consumer Staples (-1.2%), Utilities (-0.27%), and Health Care (1.2%).
Like what you see? Click here to gain full access to Bespoke and our 2017 outlook report.