Beware the Worst Subsector in the Power Gauge Today

Folks, the S&P 500 Index is nearing new highs... After the steep pullback last month and earlier this month, stocks have been rallying. By now, the S&P 500 is about 1% away from a new high. [Chaikin PowerFeed]( Beware the Worst Subsector in the Power Gauge Today By Vic Lederman, editorial director, Chaikin Analytics Folks, the S&P 500 Index is nearing new highs... After the steep pullback last month and earlier this month, stocks have been rallying. By now, the S&P 500 is about 1.7% away from a new high. And it's likely the index will cross that level in the near future. As measured by the SPDR S&P 500 Fund (SPY), the broad market has also regained its "bullish" rating in the Power Gauge. That comes after a short stretch in "neutral" territory. Meanwhile, seven of the 11 top-level sectors now earn a "bullish" or "very bullish" rating in our system. But that doesn't mean you can just throw a dart and find a winning stock... We're still seeing some dark spots. And one corner of the market is particularly worth avoiding... In the Power Gauge, this sector is stuck in "neutral" mode. And an associated subsector holds the dubious title of worst-ranked in the Power Gauge. Let's take a closer look today... Recommended Links: [Our Most Controversial Message of 2024]( The man who called the 2020 and 2022 crashes says a massive market move set to begin September 9 could be "lights out" for one of the U.S. presidential candidates and double your money 10 times as it unfolds – as he showed during 2020's election year. See his outline (and three favorite stocks) [here](. [Federal Government Wants to Put AI Inside of Every American Home]( Executive Order 14110 means the U.S. government is now rolling out a powerful form of AI across thousands of American homes. Yours could be one of them. It's all part of a huge change about to sweep our country, which could change your life in some very unusual ways. [Get the full story while there's still time](. It may not feel like it, but the price action of the broad market is still strong. Over the past three months alone, SPY gained nearly 6%. So far this year, it's up almost 19%. Folks, that's a staggering return. And it calls into question any segment of the market that isn't keeping pace. So today, let's look at one of those laggards – the energy sector. In the Power Gauge, we track it with the Energy Select Sector SPDR Fund (XLE). While SPY is up nearly 6% over the past three months, XLE is down more than 5%. That means the energy sector has underperformed the broad market by roughly 11% over this recent three-month time frame. Looking at the Power Gauge, it's easy to see why... [Chaikin PowerFeed] As you can see, XLE currently earns a "neutral" rating. And it holds only two "bullish" stocks... but seven "bearish" or worse ones. By Power Bar ranking, that ranks it second to last among the top-level sectors. But we can dig a little deeper... You see, the SPDR S&P Oil & Gas Equipment & Services Fund (XES) is the lowest-ranked subsector in the Power Gauge. And its Power Bar rating is abysmal. Take a look... [Chaikin PowerFeed] As you can see, XES currently gets a "very bearish" rating. Meanwhile, the fund holds just one "bullish" stock... and 20 "bearish" or worse stocks. That puts XES firmly in last place in the subsector rankings. Like you would expect, that has also translated to terrible performance. Over the past three months, XES has tumbled around 11%. So the market is on the edge of making new highs. And it might feel like you could soon "buy anything" and win. But the Power Gauge is clear. Right now, the energy sector is hurting. And oil and gas services are among the worst of the worst. Does that mean they'll stay that way forever? Of course not... But it does mean that picking stocks in this segment of the market poses a big uphill battle right now. The Power Gauge simply sees too many "bearish" pitfalls here today. So as this market evolves, look for the "bullish" opportunities. And avoid the "bearish" ones – like we're seeing right now in oil and gas services. Good investing, Vic Lederman Market View Major Indexes and Notable Sectors # Hld: Bullish Neutral Bearish Dow 30 -0.37% 8 17 5 S&P 500 -0.79% 145 276 69 Nasdaq -1.59% 17 63 19 Small Caps -0.87% 561 989 377 Bonds -0.97% — According to the Chaikin Power Bar, Large Cap stocks and Small Cap stocks are Bullish.. Major indexes are mixed. * * * * Sector Tracker Sector movement over the last 5 days Staples +1.64% Real Estate +1.6% Utilities +1.51% Financial +1.38% Health Care +1.36% Materials +1.17% Communication +1.03% Discretionary +0.88% Industrials +0.67% Information Technology -0.29% Energy -1.65% * * * * Industry Focus Retail Services 12 42 22 Over the past 6 months, the Retail subsector (XRT) has underperformed the S&P 500 by -5.70%. Its Power Bar ratio, which measures future potential, is Weak, with more Bearish than Bullish stocks. It is currently ranked #17 of 21 subsectors and has moved down 2 slots over the past week. Indicative Stocks [rating] SVV Savers Value Village [rating] JWN Nordstrom, Inc. [rating] GRPN Groupon, Inc. * * * * Top Movers Gainers [rating] BEN +4.55% [rating] NDSN +3.33% [rating] CNP +3.06% [rating] ARE +2.2% [rating] STT +2.18% Losers [rating] MRNA -6.47% [rating] INTC -6.12% [rating] TSLA -5.65% [rating] ON -4.32% [rating] LRCX -4.31% * * * * Earnings Report Reporting Today Rating Before Open After Close No earnings reporting today. Earnings Surprises [rating] WSM Williams-Sonoma, Inc. Q2 $1.74 Beat by $0.13 [rating] INTU Intuit Inc. Q4 $1.99 Beat by $0.14 [rating] ROST Ross Stores, Inc. Q2 $1.59 Beat by $0.10 [rating] WDAY Workday, Inc. Q2 $1.75 Beat by $0.10 * * * * You have received this e-mail as part of your subscription to PowerFeed. 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