Seeking Alpha

Smokestacks rule as money flees momentum names

  • Twitter's down 32% this year, Facebook's off 20% in a month, and biotech nearly that much, but money is returning to the industrial sector. While the Nasdaq 100 posted its worst one-day drop since 2011 on Friday and last week fell for the 3rd week in 4, the Industrial Select SPDR (XLI) gained 1.6%.
  • In the year's first quarter, the XLI had lost 1.4%, putting it in 9th place among 10 S&P 500 groups.
  • "You’re seeing the beginning of investors shifting money ahead of a wave of spending,” says Drew Nordlicht of HighTower Advisors. “The expectation is, as the economy begins to kick into a higher gear, corporate America will utilize the amount of cash to spend on capital expenditures."
  • GE comprises more than 10% of the XLI, and UTX, Union Pacific, Boeing, and 3M round out the top 5, each with holdings in the 5% range.
  • Related ETFs: XLI, PHO, CGW, PIO, VIS, ITA, FIW, PPA, IGF, CARZ, IYJ, XAR, IPN, EMIF, FIDU, PRN, UXI, FXR, PXR, EXI, GII, EVX, FLM, RGI, SIJ, PSCI, NFRA, TOLZ, AXID
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