Change in Investors' Preferences Shows Anticipation of an Economic Slowdown

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

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

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