During the recent market correction, two sectors and the exchange traded funds (ETFs) that track them, fared well. Simultaneously, investors were looking for safety and energy prices were rising. Energy ETFs handled the stress well as did global utility funds. Carl Delfeld of Chartwell Advisor notes the price of crude oil rose over $60 a barrel, helping energy ETFs, such as iShares S&P Global Energy (IXC). As investors looked for safety, iShares S&P Global Utilities Sector(JXI) represented a "classic defensive sector".
The question is, are these ETFs just handling the stress better than other ETFs or are they starting a long-term trend? Watch the ETFs and their 200-day moving average to get a better idea.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.