Safety In Vogue:
For the second session in a row the staples have put forth a formidable response. Tuesday they were the best behaved major S&P sector higher by more than 4%, fractionally better than technology. Wednesday the group was the third “best” actor of the 11 sectors, falling 1.6%. On a 3 month look back period it is number one of eleven, and the way the group is operating it reminds me a bit of healthcare. There is growth in the space, with the combination of some decent dividend yields. Below shows the action of the ratio chart comparing the XLP to the S&P 500, and one sees the fund is taking a prudent pause after a nearly vertical run up between late February and late March. CLX is a good example of what is working within, higher by 28% YTD and a dividend yield of more than 2%, as it attempts to CLOSE above the very round 200 number for the first time. WMT is sitting right off all time highs, while GIS looks appetizing too, pun intended.