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).

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

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

UTX United Technologies Corp
CAT Caterpillar Inc
HON Honeywell International Inc
XOM Exxon Mobil Corp
COP ConocoPhillips
C Citigroup Inc
LMT Lockheed Martin Corp
UNP Union Pacific Corp
DIS The Walt Disney Co
MON Monsanto Co
GOOG Google Inc
HD Home Depot Inc
HAL Halliburton Co
TWX Time Warner Inc
DOW Dow Chemical Co
GS Goldman Sachs Group Inc
FDX FedEx Corporation
UPS United Parcel Service Inc
BAC Bank of America Corp
WFC Wells Fargo & Company

Dave Mecklenburg is the Publisher of TigerSharkTrading.com.