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).

XLF Financial Select Sector SPDR Fund
XLB Materials Select Sector SPDR Fund
XLP Consumer Staples Sector SPDR Fund
XLE Energy Select Sector SPDR Fund
XLK Technology Select Sector SPDR Fund

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

WFC Wells Fargo & Company
NWSA News Corp
MET MetLife Inc
CVS CVS Caremark Corp
CVX Chevron Corp
GD General Dynamics Corp
BAC Bank of America Corp
COP ConocoPhillips
MRK Merck & Co Inc
EMC EMC Corp
PM Philip Morris International Inc
UPS United Parcel Service Inc
EBAY eBay Inc
FCX Freeport-McMoRan Copper & Gold Inc
F Ford Motor Co
CMCSA Comcast Corp
APA Apache Corp
ORCL Oracle Corporation
USB US Bancorp
MON Monsanto Co
BMY Bristol-Myers Squibb Company

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