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
XLI Industrial Select Sector SPDR Fund
XLK Technology 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).

GS Goldman Sachs Group Inc
MS Morgan Stanley
TXN Texas Instruments Inc
JPM JPMorgan Chase & Co
C Citigroup Inc
DIS The Walt Disney Co
TWX Time Warner Inc
FDX FedEx Corporation
QCOM QUALCOMM Inc
MET MetLife Inc
HAL Halliburton Co
EBAY eBay Inc
BHI Baker Hughes Inc
USB US Bancorp
NOV National Oilwell Varco Inc
SLB Schlumberger Ltd
DD E I du Pont de Nemours and Co
CAT Caterpillar Inc
OXY Occidental Petroleum Corp
EMC EMC Corp
UPS United Parcel Service Inc
HON Honeywell International Inc
GE General Electric Co

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