Sector Winners and Losers week ending 1/8

Original Chart

Energy ( XLE ) finds itself back at the top of the sector list for the first week of 2021. It’s not something you might expect as the blue wave hit US politics, which doesn’t bode well for traditional energy stocks. However, crude oil is over $50 a barrel for the first time since April after Saudi Arabia surprisingly cut output.

The blue wave did have some expected impact this week. After the Georgia run-off results showed Democrats would take control of the senate, US Treasury Bond yields took off as investors expect more stimulus that would further impact the US Dollar . That caused Financials ( XLF ), especially big banks, to have big gains on Wednesday and Thursday.

Materials ( XLB ) benefited from the blue wave news, as we can expect big investments in US infrastructure with the new administration.

Industrials XLI ) also had a boost on Wednesday, with some benefit from infrastructure spend, but also several segments like airlines likely to benefit from further stimulus. However, Industrials did not continue the rise and ended the week behind the S&P 500 .

Consumer Discretionary ( XLY ) got a boost on Friday, perhaps from higher than expected Consumer credit numbers on top of the promise of new stimulus. Quite a few people had a good Christmas it seems.

At the bottom of the list is Real Estate ( XLRE ) which is likely to suffer in the bottom line from the higher interest rates.

Technology ( XLK ) had the opposite reaction to the blue wave on Wednesday but regained from losses on Thursday and Friday to end the week just behind Industrials .

Also notable is Utilities ( XLU ) which lost for the week, but had gains on Friday as a defensive move heading into a likely emotion filled weekend for the United States.


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