The financials are getting hit by the subprime issue in a big way. Notice the 10, 20 and 50 day SMA are all heading lower. The 10 day SMA is below the 20 day SMA, which is below the 50 day SMA. As a result, the smaller duration moving averages are pulling the longer duration averages lower. Finally, the index is trading below the 200 day SMA.
In short, 20% of the S%P 500 is in a terrible technical position.
Technology is heading higher, although it's not the strongest rally; the upward trajectory is weak. However, a weak upward rally is better than nothing. Also notice that all the moving averages are heading higher. If this index continues on its current trajectory it will help to stabilize the downward pull of the financials.
Health care sold off in early June and has trended down since then. However, it appears to be stabilizing. The 10 day SMA is heading higher. However, the shorter term SMAs (the 10 and 20) are still below the 50 which will pull the longer term SMAs lower. Short version: health care is struggling.
The industrials mirror the technology area. While this index is heading higher, it's not the strongest rally we've seen. However, the larger industrials have good international sales exposure and a very cheap dollar. This should help earnings reports giving this sector a lift.
Energy is in good shape. It has rallied since the end of June. All the SMAs are heading higher. Also, oil is trading above $70/bbl. Assuming oil continues at current prices we should see this sector do well.
1.) Two sectors -- financials and health care -- are languishing. Health care is trying to make a comeback, but the jury is still out. These sectors comprise 32.44% of the S&P.
2.) Two sectors -- technology and industrials -- are rallying, but the rally's trajectory is weak. These sectors comprise 26.88% of the S&P.
3.) One sector -- energy -- is doing well. It comprises 10.79% of the index.
