Below is a scatter chart showing the performance of S&P 500 sectors from 6/24 through 7/7 (when the S&P rallied 6.7%) versus the performance since 7/7 (with the S&P 500 down 2.92%). In general, the sectors that went up the most during the prior rally have sold off the most since the rally ended last Thursday. The four defensive sectors (utilities, telecom, consumer staples and healthcare) are all bunched up in the top left corner of the chart. These sectors all went up between 3% and 4% from 6/24 through 7/7 and have gone down between 1% and 2% since then. Energy, technology, consumer discretionary and materials went up the most during the rally (between 8% and 9%), and they're all down right around 3% during the current pullback. Industrials and financials are the two sectors that stand out the most in the chart. The industrials sector rallied slightly less than the other cyclicals from 6/24 through 7/7, and it has fallen more than the other cyclicals since 7/7. The financial sector was up less than the S&P 500 during the 6/24-7/7 rally, and it is down the most of any sector since 7/7 with a decline of 4.35%. Yes, the financial sector continues to act as a drag on the market.
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We also broke the S&P 500 into deciles (10 groups of 50 stocks each) based on stock performance during the rally from 6/24 to 7/7 to see how the best and worst performing stocks during that time period have done during the pullback. As shown in the chart below, the average performance of stocks in each decile since 7/7 has been pretty similar across the board. Typically the stocks that go up the most during a rally also go down the most on pullbacks, but that hasn't been the case this time around.
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For those interested, below are the S&P 500 stocks that have declined the most since last Thursday's close.