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

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

GILD Gilead Sciences Inc
AXP American Express Co
MDT Medtronic Inc
EMR Emerson Electric Co
COST Costco Wholesale Corporation
JPM JPMorgan Chase & Co
GOOG Google Inc
APC Anadarko Petroleum Corp
ORCL Oracle Corporation
GS Goldman Sachs Group Inc
T AT&T Inc
FCX Freeport-McMoRan Copper & Gold Inc
ACN Accenture PLC
BAX Baxter International Inc
HON Honeywell International Inc
EBAY eBay Inc
BAC Bank of America Corp
MS Morgan Stanley

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