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).

XLI Industrial Select Sector SPDR Fund
XLK Technology Select Sector SPDR Fund
XLF Financial 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).

GS Goldman Sachs Group Inc
MS Morgan Stanley
C Citigroup Inc
UNP Union Pacific Corp
BRK.B Berkshire Hathaway Inc
DVN Devon Energy Corp
GOOG Google Inc
AXP American Express Co
F Ford Motor Co
BAC Bank of America Corp
JPM JPMorgan Chase & Co
MMM 3M Company
TGT Target Corporation
APC Anadarko Petroleum Corp
WFC Wells Fargo & Company
V Visa Inc

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