Where the Momentum Is: Internet, Regional Banks Lead, Energy Falls (HHH, RKH, IGE, XLE, IYE)

Nick Perry (Schaeffer's Investment Research) submits: Two weeks ago we saw continued selling as most groups traded lower, while utilities and various energy-related groups were the worst performers. This past week we find that the utilities and energy groups continued to struggle...

The magnitude of the declining groups still outpaced the moves on the upside, but we see a closer balance than we have in the last couple of weeks. At the top of the list we find the internet ETF. While the HHH does not include Google (GOOG) , and therefore isn't directly benefiting from Friday's gap higher, the move higher might be giving a boost to the overall psychology surrounding the group.

As I noted, the utilities and energy groups continued to struggle and some of the ETFs are nearing the long-term support levels I showed here. I haven't changed my views but clearly I have been wrong on the short-term action. For the longer-term view to hold, these groups will need to start showing some signs of stabilizing as they near support.

For a longer-term perspective, the bullets below show the year-to-date returns for the ETFs listed above.

Year-to-Date Returns for This Week's Top Performing Sector Exchange Traded Funds:

Internet HOLDRS (HHH) -14.3%
Regional Bank HOLDRS (RKH) -7.1%
iShares Software Index (IGV) -6.3%
iShares Networking (IGN) -1.9%
iShares Technology (IYW) -2.6%
iShares Treas Bond (TLT) +3.2%
Retail HOLDRS (RTH) -5.7%
iShares Technology Indx (IGM) -4.3%
Nasdaq-100 Trust (QQQQ) -3.6%
iShares Financial Svcs (IYG) -6.8%

Year-to-Date Returns for This Week's Bottom Performing Sector Exchange Traded Funds:

iShares Healthcare (IYH) +1.6%
Health Care Sector SPDR (XLV) -0.0%
iShares Utilities (IDU) +7.3%
Utilities HOLDRS (UTH) +11.4%
Utilities Sector SPDR (XLU) +8.2%
Pharmaceutical HOLDRS (PPH) -7.7%
Oil Service HOLDRS (OIH) +27.1%
iShares Natural Resource (IGE) +20.5%
Energy Sector SPDR (XLE) +26.0%
iShares Energy (IYE) +21.7%

Nick Perry ([e-mail])

Related:

• Other articles on the Seeking Alpha Network by Nick Perry.

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