S&P 500 SECTOR ANALYSIS The SP:SPX index recorded a performance of + 26.89% (price return). The values of the weights at 31/12/2021 and the trend of the different sectors in the last year are the following: - Information Technology SP:S5INFT: weight 29.2% - 2021 performance 33.35% - Health Care SP:S5HLTH: weight 13.3% - performance 2021 + 24.16% - Consumer Discretionary SP:S5COND: weight 12.5% - performance 2021 + 23.66% - Financials SP:SPF: weight 10.7% - performance 2021 + 32.55% - Communication Services SP:S5TELS: 10.2% weight - 2021 performance + 20.53% - Industrials SP:S5INDU: weight 7.8% - performance 2021 + 19.40% - Consumer Staples SP: S5CONS: weight 5.9% - performance 2021 + 15.55% - Real Estate SP:S5REAS: weight 2.8% - performance 2021 + 42.49% - Energy SP:SPN: weight 2.7% - performance 2021 + 47.74% - Materials SP:S5MATR: weight 2.6% - performance 2021 + 25.00% - Utilities SP:S5UTIL: weight 2.5% - performance 2021 + 13.99% * (Weights rounded to the nearest decimal, as per the S&P methodology, the aggregate weights can be different from 100%)
Only 4 sectors performed higher than the index SP:SPX(weight 45.40%) and the remaining 5 sectors (weight 54.80%) recorded lower performances. In the graph there are two red bands, corresponding to periods in which SP:SPX had a negative trend, in these periods only two S&P sector had an inversely correlated trend (SP:SPN and SP:SPF).
FOCUS 01/11/2021 – 19/12/2021 In this period, SP:SPX index moved sideways, marking a -0.98% with the following sectors for which their performance must be highlighted: - Negative performance: Energy SP:SPN (-9.82%), Financials SP:SPF (-6.49%), Communication Services SP:S5TELS (-5.68%) - Positive trend: Consumer Staples SP:S5CONS (+ 4.54%), Real Estate SP:S5REAS (+ 3.72%), Information Technology SP:S5INFT (+ 3.17%)
FOCUS 20/12/2021 – today In the last 3 weeks the performance of SP:SPX has been positive with a return of + 3.36%. As can be seen from the graph, the performance of the various sectors was in line with the benchmark until 31/12/2021, but since the beginning of the year various sectors have moved differently between them and with respect to the market (negative trend from at the beginning of the year equal to -2.10%). In particular, the sectors Energy SP:SPN + 5.75% YTD (+ 15.41% for the period in focus) and Financials SP:SPF + 2.89% YTD (+ 8.57% for the period in focus) they have had an opposite trend to the market since the beginning of the year. While the other sectors have moved more or less like the market, with Information Technology SP:S5INFT -4.70% YTD (+ 1.41% for the period in focus) and Consumer Discretionary SP:S5COND -3.61% YTD (+ 5.32% for the period in focus) which performed significantly lower than SPX since the beginning of the year.
PERFORMANCE ANALYSIS OF EACH SHARES OF S&P 500 INDEX IN 2021 Information Technology + 6.46% compared to SPX (weight 29.2%) SP:S5INFT Number of shares: 77 Share performance: 15.8% negative return vs 84.2% positive return Equity yield comparison with SPX: 50% lower return vs 50% higher return Comparison of share returns with sector index: 53.9% lower return vs 46.1% higher return Notes: nothing unusual
Healt Care -2.73% compared to SPX (weight 13.3%) SP:S5HLTH Number of shares: 64 Share performance: 20.3% negative return vs 79.7% positive return Equity yield comparison with SPX: 53.1% lower return vs 46.9% higher return Comparison of share returns with sector index: 50% lower return vs 50% higher return Notes: nothing unusual
Consumer Discretionary -3.23% vs SPX (weight 12.5%) SP:S5COND Number of shares: 61 Share performance: 13.1% negative returnvs 86.9% positive return Equity yield comparison with SPX: 47.5% lower return vs 52.5% higher return Comparison of share returns with sector index: 39.3% lower return vs 60.7% higher return Notes: nothing unusual
Financials + 5.66% compared to SPX (weight 10.7%) SP:SPF Number of shares: 67 Share performance: 4.5% negative returnvs vs 95.5% positive return Equity yield comparison with SPX: 26.9% lower return vs 73.1% higher return Comparison of share returns with sector index: 43.3% lower return vs 56.7% higher return Notes: About 3/4 of the shares in this sector outperformed the market, only 5% of the shares had negative returns
Communication Services -6.36% compared to SPX (weight 10.2%) SP:S5TELS Number of shares: 27 Share performance: 51.9% negative returnvs vs 48.1% positive return Equity yield comparison with SPX: 81.5% lower return vs 18.5% higher return Comparison of share returns with sector index: 66.7% lower return vs 33.3% higher return Notes: sector in which half of the shares had negative returns, in addition 2/3 of the shares had lower returns than their sector
Industrials -7.49% compared to SPX (weight 7.8%) SP:S5INDU Number of shares: 72 Share performance: 12.5% negative return vs 87.5% positive return Equity yield comparison with SPX: 55.6% lower return vs 44.4% higher return Comparison of returns on shares with sector index: 43.1% lower return vs 56.9% higher return Notes: sector with return below the S&P 500, but nearly 90% of the shares had positive returns
Consumer Staples -11.34% vs SPX (weight 5.9%) SP:S5CONS Number of shares: 32 Share performance: 18.8% negative return vs 81.3% positive return Equity yield comparison with SPX: 78.1% lower return vs 21.9% higher return Comparison of share returns with sector index: 62.5% lower return vs 37.5% higher return Notes: about 80% of the shares had positive returns but lower than the S&P 500 index
Real Estate + 15.60% compared to SPX (weight 2.8%) SP:S5REAS Number of shares: 29 Share performance: 0% negative return vs 100% positive return Equity yield comparison with SPX: 34.5% lower return vs 65.5% higher return Comparison of share returns with sector index: 48.3% lower return vs 51.7% higher return Notes: All stocks had positive returns
Energy + 20.85% compared to SPX (weight 2.7%) SP:SPN Number of shares: 21 Share performance: 0% negative return vs 100% positive return Equity yield comparison with SPX: 19.0% lower return vs 81.0% higher return Comparison of share returns with sector index: 47.6% lower return vs 52.4% higher return Notes: All stocks had positive returns
Materials -1.89% compared to SPX (weight 2.6%) SP:S5MATR Number of shares: 28 Share performance: 7.1% negative return vs 92.9% positive return Equity yield comparison with SPX: 50% lower return vs 50% higher return Comparison of share returns with sector index: 50% lower return vs 50% higher return Notes: Over 90% of the shares had positive returns
Utilities -12.90% compared to SPX (weight 2.5%) SP:S5UTIL Number of shares: 28 Share performance: 3.6% negative return vs 96.4% positive return Equity yield comparison with SPX: 89.3% lower return vs 10.7% higher return Comparison of share returns with sector index: 50% lower return vs 50% higher return Notes: This is the lowest performing sector compared to the S&P 500, however only 1 stock had negative returns
RELATIVE ROTATION GRAPH (weekly data) - LEADING: Materials, Real Estate, Information Technology, Consumer Discretionary (high probability to move to WEAKENING) - WEAKENING: Energy - LAGGING: Financials, Communication Services - IMPROVING: Industrials , Utilities, Health Care, Consumer Staples
RELATIVE ROTATION GRAPH (daily data) - LEADING: Materials - WEAKENING: Health Care, Consumer Staples, Utilities, Real Estate, Information Technology (high probability to move to LAGGING) - LAGGING: - IMPROVING: Financial, Industrials , Consumer Discretionary, Energy (it's probable to move to LEADING), Communication Services (probable return to LAGGING)
Dr. Cunti Mattia, CFTe®, EFA
** WARNING ** The content of the analysis just carried out is the result of personal opinions and does not constitute a solicitation to buy or sell any financial instrument. These views therefore do not constitute advice or a recommendation to invest or disinvest. The analyzes are for informational purposes only, and do not constitute personalized advice, as the writer does not know the personal characteristics of any of the readers, especially income flows, ability to bear losses, equity consistency.