Liz Ann Sonders from Charles Schwab recently pointed out, market breadth, or the number of stocks participating in this year recovery is broadening and increasing.
What does the data say?
Looking under the microscope we see an expanding number of new 52 week highs in the NASDAQ and NYSE universes. Yesterday, on the NYSE there were 257 new highs versus just 4 new lows. On the NASDAQ there were 218 versus 25.
What sectors are showing the most?
Financials, Broad Technology (think Semiconductors, Software) Healthcare including Biotech as well as Building (think materials).
Internally, we like to concentrate holdings in the strongest sectors. We refer to these in our Investment Policy Committee Meetings as “favored sectors' '.
Consider starting your screening with these areas as historically favored sectors tend to exhibit strength for the full calendar year.