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).

XLY Consumer Discretionary Sector SPDR Fund
XLP Consumer Staples Sector SPDR Fund
XLF Financial Select Sector SPDR Fund
XLI Industrial Select Sector SPDR Fund
XLK Technology Select Sector SPDR Fund

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

JPM JPMorgan Chase & Co
SLB Schlumberger Ltd
INTC Intel Corp
MDT Medtronic Inc
DOW Dow Chemical Co
CSCO Cisco Systems Inc
PEP Pepsico Inc
MCD McDonald's Corporation
GE General Electric Co
LOW Lowe's Companies Inc
EMR Emerson Electric Co
MO Altria Group Inc

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