The market bottomed after the puke on June 1st from the weak Payrolls number. The rally off the bottom was initially led by the cyclical sectors.
Financials were the leader, but energy was a close second by the middle of June. Looking today though, energy has of course fallen out of bed, but health care is now up as much as financials (partly due to anticipation of the Supreme Court decision). Consumer discretionary is also now up about as much as consumer staples and Utilities.
Bespoke had a good chart today as well relating to reduced earnings expectations for Q2, shown here:
Investors seem to be agreeing with analysts’ reduced expectations as enthusiasm for cyclical sectors continues to be short-lived. However, I think the market’s discounting mechanism is actually looking 6-9 months out, and it doesn’t like what it sees around the globe. There is a cocoon mentality among large institutional investors, and I still see little on the horizon to change that.