S&P 500 Sectors

Chart of the Week for September 23-29, 2005

Just as the market as a whole can post a good or bad year, so too can individual sectors of the market. A sector can outperform over an extended period and then underperform in subsequent periods, trailing all other sectors. For example, technology shot up over 150% in 1998 and 1999; over the next three years, the sector lost these gains and more. Currently, the Energy sector is enjoying the leadership position — a spot it held for 2004 as well as year-to-date through September 21. Since January 1, 2004, the Energy sector has climbed 87%; the return of the next closest sector, Utilities, is 50%. The remaining sectors that make up the S&P 500 range from 0.4% to 12.3% over the same time period.

Will the cost of energy continue to increase? Are we looking at another Oil Crisis reminiscent of the mid-1970s? The Fed doesn't seem to think so; they raised interest rates for the 11th consecutive time earlier this week.

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