Looking For Hideouts:
As markets almost took a precise cue Wednesday from weak seasonality with the sell off, many may start to look for cover. One day the downgrade of US debt does not make a trend, but market participants should be vigilant to protect big gains that have already shown themselves in 2023 thus far. The staples showed some muscle on a soft tape on hump day, as the XLP was the best performing of the major 11 S&P sectors. The fund trades just 3% off most recent 52-week highs, which is a bit misleading as it has only gained 3% YTD, besting just energy, utilities, and healthcare. It could be a place to park some money in the near term as tech will most likely bleed out a bit as August and September is the group’s weakest by far, before resuming its uptrend in Q4 which is traditionally what tends to take place. Some names are acting very firm in the group which has lagged overall, and those are the stocks we will focus on in this note.