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February 11, 2025

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The Best Five Sectors, #6

4 Mins Read

No Changes In Top-5

At the end of the week ending 2/7, there were no changes in the top-5, but there have been some significant shifts in the bottom 5 sectors. The most notable is the Consumer Staples sector which moved from 10th to 7th and the Healthcare sector which moved from 11th to 8th. Real Estate remained unchanged at the 9th position, while Energy dropped to 10th from 7th and Materials dropped to the last position from 8th.

New Sector Lineup

  1. (1) Consumer Discretionary – (XLY)
  2. (2) Financials – (XLF)
  3. (3) Communication Services – (XLC)
  4. (4) Industrials – (XLI)
  5. (5) Technology – (XLK)
  6. (6) Utilities – (XLU)
  7. (10) Consumer Staples – (XLP)*
  8. (11) Health Care – (XLV)*
  9. (9) Real Estate – (XLRE)
  10. (7) Energy – (XLE)*
  11. (8) Materials – (XLB)*

Weekly RRG

On the weekly RRG, the tails for XLY, XLC, and XLK are (still) inside the leading quadrant. XLK is just crossing over from improving. XLF is inside weakening but at a negative RRG-Heading, and XLI is moving deeper into the lagging quadrant at a negative RRG-Heading.

The most interesting observation on the RRG is that no sectors are currently positioned inside the improving quadrant. The Healthcare sector seems closest to crossing over, but, at the same time, is the sector with the lowest RS-Ratio reading.

Daily RRG

On the daily RRG, we can see why Staples and Healthcare made such big jumps. Both are pushing deeper into the leading quadrant on long tails.

Communication Services and Financials are confirming their positive outlook by continuing to move up on the RS-Ratio scale, with only a minimum loss of relative momentum so far. XLY has returned to the leading quadrant, but has already started to roll over. The positive thing for this sector is that it is all happening very close to the benchmark and on a very short tail.

Technology is the problem child on this RRG. This sector returned into the top-5 last week but is now again showing weakness on this daily RRG at the lowest RS-Ratio reading.

As I mentioned last week, the entry of XLK into the top 5 is not because of its strength but more as a result of weakness in other sectors. It’s all relative.

Consumer Discretionary

XLY is still holding above support, but last week formed a new peak. slightly lower, against the resistance offered by the mid-December peak. This makes the area between 235 and 240 an even more critical barrier now.

Important support remains located around 218. Relative strength is rolling over, but there is enough leeway for a correction after the strong move from August 2024 to now.

Communication Services

Communication Services is continuing to perform well and even managed to close higher than last week, confirming the uptrend in price. As a result, and given the weakness of other sectors and the SPY, relative strength for XLC is continuing to push the XLC tail further into the leading quadrant.

Financials

Financials also managed to put in a higher close for the week, confirming the current uptrend in price.

Relative strength has also taken out its previous high. When both price and RS can hold these trends, the RRG lines will soon turn up again and complete a leading-weakening-leading rotation, underscoring the attractiveness of the financials sector for the time being.

Industrials

Industrials did not manage to reach or take out its previous high and has now put a lower high in place. This still happening inside the rising channel, but it is not a sign of strength, so to say.

A similar thing can be said about the relative strength for XLI. With both RRG lines below a 100 and falling, the tail is being pushed further into the lagging quadrant.

Technology

The technology sector recovered well after a test of the lower boundary of its rising channel.

This is holding relative strength within the boundaries of the trading range which supports the slow improvement of the RRG lines. With RS-Ratio at 100.04, XLK has now just crossed into the leading quadrant.

Portfolio Performance

Shortly after the opening this Monday the portfolio is at a 4.01% gain vs 3.23% for SPY since the start of the year, picking up 0.78%.

Summary

The top-5 remains unchanged this week but in the bottom part of the list some noticeable changes are taking place, primarily in favor of defensive sectors like Healthcare and Consumer Staples, after Utilities already rose to the #6 position last week.

For the time being, the top-5 is still dominated by offensive sectors like XLY,XLC, and XLK. But how long will this last?

#StayAlert and have a great week. –Julius

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In World news

Hundreds of wounded Russian soldiers treated in North Korea, envoy says

3 Mins Read

North Korea has treated hundreds of Russian soldiers injured in Ukraine, Moscow’s ambassador to Pyongyang told state media, as he revealed new details of the reclusive state’s backing for the Kremlin’s war effort.

Wounded Russian troops have been recovering in North Korean medical facilities, Ambassador Alexander Matsegora told state-run outlet Rossiyskaya Gazeta in an extensive interview published Sunday.

“A clear example of such a brotherly attitude (between Russian and North Korea) is the rehabilitation of hundreds of wounded soldiers … in Korean sanatoriums and hospitals,” he said.

The Russian envoy’s comments are the latest sign of deepening ties between the two countries, which have recently reached heights unseen since the Cold War.

North Korea has sent about 12,000 soldiers to Russia, according to Ukrainian officials and Western intelligence reports, following Moscow and Pyongyang’s pledge to help each other if either nation is attacked in a landmark defense pact signed last June.

About 4,000 North Korean troops have reportedly been killed or injured in combat after being deployed to Kursk since at least November to repel Ukraine’s incursion in the southern Russian border region, Ukrainian officials and Western intelligence said.

Meanwhile, Russia has also received thousands of shipping containers of munitions or munitions-related material from North Korea, and Moscow’s forces have launched North Korea-made missiles on Ukraine, according to US officials.

In his interview with state media, Matsegora claimed that North Korea had treated wounded Russian soldiers for free.

“When we offered to compensate our (North Korean) friends for at least part of their expenses, they were sincerely offended and asked us never to do it again,” he said.

Matsegora also said that children of Russian troops killed in Ukraine had vacationed in North Korea last summer, and Russia and North Korea are developing student exchanges.

Moscow supplies Pyongyang with coal, food, and medicine, he added.

South Korea’s intelligence service declined to comment on Matsegora’s remarks.

The extent of care potentially available to wounded Russian troops within North Korea’s dilapidated health infrastructure remains unclear.

Doctors who have defected in recent years often speak of poor working conditions and shortages of everything from medicine to basic health care supplies.

Some analysts also cast doubt on Matsegora’s troop recuperation remarks, pointing to Russia’s brutal military tactics as the war in Ukraine grinds toward its third anniversary.

Russia “has reportedly been sending wounded personnel back into assault groups without treatment, demonstrating a general disregard for soldiers’ health,” The Institute for the Study of War said in a news release Monday, “calling into question official Russian claims to be sending Russian soldiers abroad for treatment, particularly to North Korea.”

However, any arrival of experienced Russian troops, particularly officers, in North Korea “may allow the Russian military to work with North Korean forces and disseminate lessons from the war in Ukraine while ostensibly recuperating,” the US-based conflict monitor added.

This post appeared first on cnn.com

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In Business

GameStop, MicroStrategy shares rise after Ryan Cohen posts photo with Michael Saylor

2 Mins Read

Shares of GameStop and MicroStrategy were on the rise Monday after Ryan Cohen, CEO of the video game retailer, posted a photo with Michael Saylor, co-founder and chairman of the largest corporate holder of bitcoin.

GameStop, day traders’ favorite meme stock, climbed more than 7%, while MicroStrategy, which recently rebranded as “Strategy,” saw shares rising as much as 4%. Cohen uploaded the photo over the weekend on X, sparking speculation that GameStop is plotting another strategy around crypto. MicroStrategy shares last traded up 1%.

The video game company had expanded into digital services in recent years by offering crypto wallets that let users manage their crypto and nonfungible tokens. However, the firm shut the service down in 2023, citing “regulatory uncertainty.”

Cohen, co-founder of Chewy, bought shares in GameStop in 2020 and joined the board in 2021 as GameStop became one of the key stocks in the WallStreetBets meme trading mania.

His e-commerce experience fueled hopes that he could help modernize the brick-and-mortar retailer, but the company still struggles to adapt to changing spending habits by gamers. Trading in the stock remains highly volatile and speculative as meme stock personality “Roaring Kitty” continues to spur buying from retail investors.

Saylor’s Strategy also has a fan base of retail investors as the firm touted its aggressive bitcoin-buying strategy. In the past year, the firm has raised billions of dollars through the sale of stock or convertible bonds for the sole purpose of purchasing more bitcoin.

Last week, Strategy said it’s almost halfway to its ambitious capital-raising goal as it went on a buying spree throughout the postelection rally. As of Monday, Strategy holds roughly $47 billion worth of bitcoins on its balance sheet, about 2.5% of the total supply.

This post appeared first on NBC NEWS

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