(MENAFN – DailyFX) S & P 500 Sector Performances:With a monthly return of -5%, May has fulfilled the’Sell in May and Go Away’ phenomenon Trade wars and slowing economic growth has seen defensive sectors outperform Retail traders are overwhelmingly short theDow JonesandS & P 500 , find out how to useIG Client Sentiment Datawith one of ourLive Sentiment Data Walkthroughs
S & P 500 Sector Performances Highlight Prevailing Headwinds As theS & P 500 and Dow Jones tread loweron the back of renewed concerns regarding trade wars and global growth, investors have begun to seek exposure in sectors that can withstand a continuation of May’s price action. With one session remaining, May looks poised to end the month -5.05% lower – marking the first down month in 2019 thus far. Across a broader timeframe, May is on pace to post the third worst monthly return since the beginning of 2016, behind only October and December 2018.
On a sector basis, conventional market wisdom has resulted in the more-defensive sectors heralding strength at the end of May. Utilities, healthcare and consumer staples have been relatively unfazed by the recent market turbulence – suggesting investors are digging in their heels for continued pressure. The three sectors are typically viewed as defensive because of their inelasticity and consistent returns. Specifically, utilities have enjoyed the prospect of waning yields elsewhere and a prolonged low interest rate environment – making their consistently high dividend relatively attractive.
On the other hand, the energy, industrials and technology sectors are some of the Index’s biggest laggards. Weakness in the energy industry is partially attributable to waning demand forecasts as global growth slips -a headwind that alsoweighs on crude oil prices.Industrials share a similar position as economic forecasts project lower output and fewer purchases. The industry has also been