Two the Point — A Clear Message from Market Leadership?

Sometimes market prices can provide the strongest signal for investors. In our view, what’s been working (and what hasn’t been working) in the stock market paints a clear picture of risk aversion even as the S&P 500 increased nearly 10% from the March 13, 2023, low to the most recent high.

Key Relative Performance Relationships since March 13 include:

  • Consumer Staples outperformed Consumer Discretionary by 3.0%.
  • Small Caps underperformed Large Caps by 7.1%.
  • Gold outperformed Copper by 10.6%.
  • Transports underperformed the S&P 500 by 8.0%.
  • Healthcare outperformed the S&P 500 by 1.9%.

Banks, which we discussed in last week’s Two the Point, are another glaring example of performance trends that would be atypical at the beginning of a new bull market. In fact, this would be the first time in over 50 years that bank stock performance was negative six months after the S&P 500 made a cycle low. We continue to believe stocks will be stuck in neutral for the foreseeable future.

Source: Factset; Bryn Mawr Capital Management as of 4/25/2023


WSFS Bank is committed to digital accessibility.