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
XLK Technology Select Sector SPDR Fund
XLV Health Care Select Sector SPDR Fund
XLY Consumer Discretionary Sector SPDR Fund
XLE Energy Select Sector SPDR Fund

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

SLB Schlumberger Ltd
UTX United Technologies Corp
UPS United Parcel Service Inc
NOV National Oilwell Varco Inc
COP ConocoPhillips
BHI Baker Hughes Inc
HAL Halliburton Co
SO Southern Co
MSFT Microsoft Corp
XOM Exxon Mobil Corp

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