If the stock market can move sectors and stocks, which sectors and stocks are most likely to move in step with the stock market? Sectors and individual stocks most highly correlated to the overall market can use the S&P 500 SPDR ETF (SPY) as a directional indicator.

The following sectors are most correlated the S&P 500 SPDR ETF (SPY).

XLK Technology Select Sector SPDR Fund
XLF Financial Select Sector SPDR Fund
XLB Materials Select Sector SPDR Fund
XLI Industrial Select Sector SPDR Fund
XLV Health Care Select Sector SPDR Fund
XLY Consumer Discretionary Sector SPDR Fund

The following individual stocks are most correlated the S&P 500 SPDR ETF (SPY).

GD General Dynamics Corp
USB US Bancorp
ORCL Oracle Corporation
AXP American Express Co
RTN Raytheon Co
ACN Accenture PLC
C Citigroup Inc
FCX Freeport-McMoRan Copper & Gold Inc
JPM JPMorgan Chase & Co
EBAY eBay Inc
UNP Union Pacific Corp
UTX United Technologies Corp
UPS United Parcel Service Inc
EMC EMC Corp
CSCO Cisco Systems Inc
CAT Caterpillar Inc
JNJ Johnson and Johnson
DOW Dow Chemical Co
FDX FedEx Corporation
LMT Lockheed Martin Corp
NWSA News Corp
BRK.B Berkshire Hathaway Inc
GS Goldman Sachs Group Inc
CL Colgate Palmolive Co
MDT Medtronic Inc
COP ConocoPhillips

Dave Mecklenburg is the Editor-in-Chief of TigerSharkTrading.com.