Chart Indices & Sectors

Sector Rotation chart-


Legend: Market Cycle | Economic Cycle

This theoretical model is based on Sam Stovall's S&P's Guide to Sector Rotation and states that different sectors are stronger at different points in the economic cycle. The graph above shows these relationships and the order in which the various sectors should get a boost from the economy. The Market Cycle preceeds the Economic Cycle because investors try to anticipate economic effects. The PerfChart at the top of this page tries to help you see this effect.

Stage:	Full Recession	Early Recovery	Full Recovery	Early Recession
Consumer Expectations:	Reviving	Rising	Declining	Falling Sharply
Industrial Production:	Bottoming Out	Rising	Flat	Falling
Interest Rates:	Falling	Bottoming Out	Rising Rapidly (Fed)	Peaking
Yield Curve:	Normal	Normal (Steep)	Flattening Out	Flat/Inverted

(Courtesy Stock Charts.com)