Which sectors are rallying this year?

Small caps outperformed once again last week, says Prab Sagoo, associate director at Nasdaq Advisory Services, in his weekly market commentary. Conversely, he finds REITs and utilities suffered, underperforming along with continually weak healthcare names.

Read: REIT analysis tips from equity and bond managers

But, year to date, telco, utilities and hot materials sectors are three of the four best performing sectors, he adds. That points to a defensive rally.

Read: 10 best defensive stocks

More highlights

• Last week, the TSX hit a new intraday high for the year. But it wasn’t able to maintain that record, as U.S. indices continued to break records.Volumes last week were on the lighter side across the benchmark.
• From a technical standpoint, we continue to have +70% of constituents trading above their 50 day moving averages, and +80% over their 200 day moving averages. As such, we now also have 28 companies sitting at technically overbought status—interestingly, only three materials names are technically overbought, though there are six industrials and six energy names.
• This week will be a more active on the economic front, with manufacturing, retail trade and inflation data coming out.
• If we see further weakness in manufacturing, we could see some analysts start to look at the BoC for a possible rate cut. Read: Business investment hasn’t been this crummy in 40 years
• On Wednesday, we’ll have Fed FOMC meeting minutes, which will once again be closely watched. Read: Two hikes from the Fed this year? Still unlikely, says expert

Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.