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
XLY Consumer Discretionary Sector SPDR Fund
XLE Energy Select Sector SPDR Fund
XLK Technology Select Sector SPDR Fund
XLF Financial Select Sector SPDR Fund

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

SLB Schlumberger Ltd
HON Honeywell International Inc
BHI Baker Hughes Inc
XOM Exxon Mobil Corp
UNP Union Pacific Corp
APC Anadarko Petroleum Corp
APA Apache Corp
MSFT Microsoft Corp
FCX Freeport-McMoRan Copper & Gold Inc
DIS The Walt Disney Co
LOW Lowe's Companies Inc
AAPL Apple Inc
HAL Halliburton Co
GE General Electric Co
HD Home Depot Inc
CMCSA Comcast Corp
F Ford Motor Co
TWX Time Warner Inc

Dave Mecklenburg is the Publisher of TigerSharkTrading.com.