从板块 Rotation 看经济周期：Where are we now? (ZT)

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(BY Gary Gordon)

It’s one thing to recognize a cyclical bull market’s gains off bear market bottoms. In fact, by using the magical March 9 of ‘09 as an inflection point, we tend to think that little has changed in sector leadership.

Across the entire 7 1/2 months, the financial sector has been the risky uber-mover with monstrous volatility. Tech and materials stocks have been the favorites for growth story advocates. Energy has been the “steady Eddie.” Picking up the rear are the defensive names like health care, staples and utilities.

However, change in momentum data (i.e., 1 month, 2 months, 3 months) might provide clues as to the nature of the current business cycle; that is, relative outperformance in the shorter-term may reflect bigger picture change that one can’t see from a bear’s bottom.

Historically, financial and transportation stocks outperform prior to the start of economic recovery. Mid-way through, technology and industrial stocks outperform. Towards the end of a biz cycle, energy and basic materials are usually working the leader-board. Finally, when sub-par growth/stagnation/recession slow an expansion, you often see the strongest percentage gains by “can’t-do-without” segments like consumer staples and health care.

If history is any guide… and that’s a gigantic ”IF” indeed… where do the current momentum numbers suggest that we are at? (Note: In the table below, I sorted the sector ETFs by 1-month returns to reflect the most recent strength.)

Sector Momentum Over 1, 2 and 3 Months
                                                                                 


Off the bear market bottom, Energy (XLE) has actually underperformed the SPDR S&P 500 Trust (SPY)… 54% versus 62%.  Now take a look! Energy (XLE) is one of the standouts across all 3 momentum periods.

Is this indicative of a shortened business cycle? Or are we simply seeing a rotation into energy as crude oil expectations for $80-$100 per barrel are being talked about?

No sector was hotter over 3 months or 7 1/2 bull market months than Financials (XLF). Yet the last 1 month and 2 months seem to be showing less and less conviction for this roll of the dice.

Again, are we moving away from early business cycle leadership? Or, are investors simply demanding healthier balance sheets with legitimate sources of recurring revenue?

Simultaneous momentum in both consumer staples and consumer discretionary defies simple explanation. Staples strength would suggest that we’re nearing the end of a cycle whereas discretionary spending might suggest the start. Perhaps it simply shows a willingness for money to come off the sidelines… anywhere and everywhere.

ruoshui

cycle

epsom

Thanks

coexist

nice points

louieca