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
XLB Materials Select Sector SPDR Fund
XLY Consumer Discretionary Sector SPDR Fund
XLE Energy Select Sector SPDR Fund
XLI Industrial Select Sector SPDR Fund

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

C Citigroup Inc
MET MetLife Inc
WFC Wells Fargo & Company
WMB Williams Companies Inc
GD General Dynamics Corp
HON Honeywell International Inc
USB US Bancorp
HAL Halliburton Co
EXC Exelon Corp
MON Monsanto Co
ALL Allstate Corp
TXN Texas Instruments Inc
LOW Lowe's Companies Inc

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