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).

XLE Energy Select Sector SPDR Fund
XLF Financial 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).

T AT&T Inc
EMR Emerson Electric Co
MON Monsanto Co
HON Honeywell International Inc
DIS The Walt Disney Co
SPG Simon Property Group Inc
TWX Time Warner Inc
MET MetLife Inc
HD Home Depot Inc
XOM Exxon Mobil Corp
C Citigroup Inc
BHI Baker Hughes Inc
SLB Schlumberger Ltd
NOV National Oilwell Varco Inc
BAC Bank of America Corp
WFC Wells Fargo & Company

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