Change in Investors' Preferences Shows Anticipation of an Economic Slowdown

by: Anonymous Investor..

The sector performance in the recent weeks shows some interesting points about the change of investors' collective mood.

As the chart below shows, the latest up-move in the S&P 500 Index, which started on August the 10th and could be a bull trap, was led by Technology, Industrial and Consumer Discretionary sectors. This sector performance suggests, that investors anticipated a soft landing at that time.

click charts to enlarge
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However, as the next chart shows, the picture has clearly change since the S&P 500 began its consolidation on August the 18th.

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In the last four days, investors preferred the Healthcare Services, Consumer Staples and Utilities sector, which indicates an anticipation of an economic slowdown.