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).

XLV Health Care Select Sector SPDR Fund
XLK Technology Select Sector SPDR Fund
XLI Industrial Select Sector SPDR Fund
XLB Materials Select Sector SPDR Fund
XLE Energy Select Sector SPDR Fund

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

BMY Bristol-Myers Squibb Company
GILD Gilead Sciences Inc
AMGN Amgen Inc
ACN Accenture PLC
GD General Dynamics Corp
BHI Baker Hughes Inc
RTN Raytheon Co
COF Capital One Financial Corp
OXY Occidental Petroleum Corp
MSFT Microsoft Corp
XOM Exxon Mobil Corp
DIS The Walt Disney Co
TWX Time Warner Inc
BA The Boeing Co
HAL Halliburton Co

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