The Industrial Select Sector SPDR (NYSEArca: XLI) and the Materials Select Sector SPDR (NYSEArca: XLB) also outperformed during that last time rates rose, indicating cyclical sector prove durable even as borrowing costs climb.
Since Jan. 30, IYT and SOXX are up 2.6% and 4%, respectively. Not surprisingly, the SPDR S&P Regional Banking ETF (NYSEArca: KRE) has some wind at its back with the recent jump in Treasury yields. KRE, the largest regional bank ETF, is up 7.1% since Jan. 30.
When Treasury yields jumped in 2013, KRE surged 47.5%. Amid the 2014 yield retreat, the ETF rose just 1.8% while the S&P 500 climbed 13.5%. KRE’s holdings have an average beta of +0.44 to moves in the US 10 Year Treasury. [A Breakout for Regional Bank ETFs]
iShares Transportation Average ETF
Tom Lydon’s clients own shares of IYT and TLT.