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March 11, 2025

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Sector Shake-Up: Defensive Moves and Tech’s Tumble

Last week’s market volatility stirred up the sector rankings, with 6 out of 11 sectors changing positions. While the top three remain steady, we see a clear rotation from cyclical to more defensive sectors. Let’s dive into the details and see what the charts tell us.

The weekly sector ranking has undergone some significant changes. Communication Services (XLC) is holding firm. Financials (XLF) is maintaining position. Consumer discretionary remains steady, but is showing weakness. Consumer Staples (XLP) is the new entrant to the top 5, while Utilities (XLU) Holds its ground at #5.

The big story here is the rise of defensive sectors. Health Care (XLV) made a notable jump from 10th to 6th place, while Technology (XLK) took a nosedive from 4th to 10th. This shift is characteristic of the broader shift from cyclical to defensive plays.

The New Sector Lineup

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

Weekly RRG: A Tale of Two Sides

The weekly Relative Rotation Graph (RRG), printed above, paints an interesting picture. We see only three sectors on the right-hand side of the graph, with the rest clustered on the left. But their movements are telling:

  • XLC is in the leading quadrant, moving northeast — a positive sign.
  • XLF has turned back up into the leading quadrant, reinforcing its #2 spot.
  • XLY is in the weakening quadrant with a long tail, heading towards lagging — a potential red flag.

On the left side:

  • XLK’s rotation is clearly weak, pushing further into the lagging quadrant.
  • Meanwhile, XLP and XLU show strength, moving with positive RRG headings in the improving quadrant.

Daily RRG: Confirming the Weekly Story

When we look at the daily RRG, we get some additional context:

  • XLC has curled up in the weakening quadrant, supporting its positive weekly rotation.
  • XLF is confirming its positive move in the leading quadrant.
  • XLY is the outlier — its short tail in the lagging quadrant doesn’t bode well for maintaining its #3 position.
  • XLP shows the strongest RS ratio reading on the daily chart, complementing its positive weekly movement.
  • XLU has lost some relative momentum over the last day, but nothing too concerning at this point.

The Top Five Charts

Communication Services – XLC

XLC is playing around with its old resistance line, now expected to act as support. Monday’s price action shows a slight revival, but it’s too early to call. The relative strength remains robust, with a clear series of higher highs and higher lows on the raw RS line.

Financials – XLF

XLF has broken its rising support line and completed a toppish formation. We’re now eyeing the next support level, around $47.25. Despite this, XLF’s relative performance remains strong, with both RRG lines moving higher.

Consumer Discretionary – XLY

After completing a top formation, XLY is now testing support around 200. It appears to be moving back into its old rising channel — and if my rule holds true, we might see it test the lower boundary. This suggests significant downside risk for the sector.

Consumer Staples – XLP

XLP, the newcomer to the top 5, is pushing against overhead resistance in the $83.50-84 area. A break here could give the sector a significant boost. The improvement in relative strength is already evident, pulling both RRG lines higher.

Utilities – XLU

XLU remains in a sideways pattern, potentially settling into a narrower range between $75.50 and $80.50.

Its relative strength is also range-bound but still pulling both RRG lines up — enough to keep it in the top 5.

Portfolio Performance Update

The technology position was exited and swapped for the consumer staples position against Monday’s opening prices.

As of about 45 minutes after opening, the portfolio performance stands at -3.19% since inception, compared to the SPY benchmark at -3.39%. We’re about 20 basis points ahead — not making a big dent, but keeping pace with the S&P 500 for now.

Going forward, I’ll be including both the performance table and the list of open positions in these articles for better tracking.

Summary

The market’s rotation towards defensive sectors is becoming increasingly evident. Consumer discretionary looks vulnerable, while consumer staples and utilities show strength.

#StayAlert, –Julius


All but one of the world’s top 20 most polluted cities last year were in Asia, a new study shows.

The majority of these cities – 13 – are in the world’s most populous country, India, where booming economic growth is fired largely by coal and where hundreds of millions live in traffic-clogged and congested megacities.

Another four are in neighboring Pakistan, with one in China and Kazakhstan respectively.

The only city outside of Asia featured on the list is N’Djamena, the capital of Chad in central Africa – which was named the country with the worst air pollution.

Meanwhile the cities with the worst pollution in North America were all in California.

The report by IQAir, a Swiss company that tracks global air quality, looked specifically at fine particulate matter, or PM2.5, one of the smallest but most dangerous pollutants.

PM2.5 comes from sources like the combustion of fossil fuels, dust storms and wildfires. It is so tiny – 1/20th of a width of a human hair – that it can travel past your body’s usual defenses into your lungs or bloodstream.

The particles cause irritation and inflammation and have been linked to respiratory problems and chronic kidney disease. Exposure can cause cancer, stroke or heart attacks and has been associated with a higher risk of depression and anxiety.

The World Health Organization (WHO) says average annual levels of PM2.5 should not exceed 5 micrograms per cubic meter.

Byrnihat, an industrial town in northeast India recorded a PM2.5 concentration of 128.2 last year – more than 25 times the WHO’s standard.

She blamed factories around the town and a booming construction industry and trees being felled as contributing to the toxic air.

“The pollution is particularly bad right now, visibility is not great, there is dust everywhere, my eyes also burn,” she said.

“I do not leave home without a mask.”

Twelve other cities in the top 20 are in India.

Its capital New Delhi featured as the world’s most polluted capital for the sixth consecutive year, with a PM2.5 concentration of 91.8. The report also listed six satellite cities – Faridabad, Loni, Delhi, Gurugram, Noida and Greater Noida – making the list.

Just last November, a throat-searing blanket of smog settled over Delhi, disrupting flights, blocking buildings from view and prompting the city’s chief minister to declare a “medical emergency.”

But overall, India – the world’s most populous nation with 1.4 billion people dropped from third to fifth place from the previous year, according to the report.

But the report said air pollution “remains a significant health burden… reducing life expectancy by an estimated 5.2 years.”

India’s neighbors Bangladesh and Pakistan – together home to some 400 million people – were second and third-most polluted countries globally in terms of PM2.5 molecules, according to the report.

China – which used to dominate global rankings of the world’s worst air – noted a small improvement, the report said.

Its national annual average PM2.5 concentration decreased from 32.5 micrograms per cubic meter to 31, with air quality improving in megacities like Beijing, Shanghai, Chengdu, Guangzhou and Shenzhen, the report said.

China is the world’s largest carbon dioxide emitter but in recent years has waged a campaign against air pollution, particularly in the cities that have fuelled its economic growth, and has pushed a massive expansion in solar and wind power.

But last month two clean-energy groups raised alarm over what they said were plans by China’s power industry to build nearly 100 gigawatts of new coal plant capacity last year, the most in nearly a decade.

All 20 of the world’s most polluted cities last year exceeded WHO PM2.5 guidelines by over 10 times, the IQ Air report showed.

Data gaps

“Air pollution remains a critical threat to both human health and environmental stability, yet vast populations remain unaware of their exposure levels,” said Frank Hammes, Global CEO of IQAir.

Iran and Afghanistan did not feature in this year’s report due to a lack of data availability.

Air quality monitoring in Southeast Asia is also a problem, with nearly all countries having “significant gaps in government-led initiatives,” the report found.

In 2024, 173 out of 392 cities in the region lacked government monitoring stations, while Cambodia had none, it said.

Those problems are likely to be exacerbated after the US announced earlier this month that it would stop sharing air quality data gathered from its embassies and consulates worldwide due to “funding constraints” the Associated Press reported.

“Air quality data saves lives,” said Hammes.

“It creates much needed awareness, informs policy decisions, guiding public health interventions, and empowers communities to take action to reduce air pollution and protect future generations.”

Worst cities in North America

Only 17% of 8,954 cities analyzed globally by IQAir recorded air quality which met WHO pollution guidelines, the report said.

The cities with the worst air pollution in North America were Ontario, Bloomington and Huntington Park – all in California, the report said.

Overall the United States saw a significant reduction in PM2.5 levels last year, with the annual average dropping 22% from 2023.

Northern America has long boasted vigorous air quality monitoring systems, contributing 56% of the total number of ground-based air quality monitoring stations included in the IQ Air report – helping scientists with their continued research on air quality and aiding policymakers to make decisions about public health.

Only 12 countries, regions, and territories recorded PM2.5 concentrations below the WHO guidelines, most of which were in the Latin America and Caribbean or Oceania region.

The report called on governments to dedicate funding for renewable energy projects and “strengthen emission limits for vehicles and industrial activities.”

Advice Suman wishes authorities in Byrnihat would take to save her city from appearing at the top of the most polluted list again next year.

“This is my birthplace. I am a local. I do not want to leave this area. We want the governments to do more, come together and work for us.”

This post appeared first on cnn.com

Struggling drugstore chain Walgreens is going private. 

The company on Thursday said it inked a deal with private equity firm Sycamore Partners that will take it off the public market for an equity value of around $10 billion.

Sycamore will pay $11.45 per share in cash for Walgreens. Shareholders could also receive up to $3 more per share in the future from sales of Walgreens’ primary-care businesses, including Village Medical, Summit Health and CityMD. Walgreens said the total value of the transaction would be up to $23.7 billion when including debt and possible payouts down the line.

Walgreens and Sycamore expect to close the take-private deal in the fourth quarter of this year. Shares of Walgreens jumped more than 5% in after-hours trading on Thursday before being halted.

The historic deal ends Walgreens’ tumultuous run as a public company, which began in 1927. As of Thursday morning, shares of the company were up more than 15% for 2025, but the stock was still down more than 48% for the last year and had fallen 70% for the past three years. 

“While we are making progress against our ambitious turnaround strategy, meaningful value creation will take time, focus and change that is better managed as a private company,” Walgreens CEO Tim Wentworth, who stepped into the role in 2023, said in a release on Thursday. “Sycamore will provide us with the expertise and experience of a partner with a strong track record of successful retail turnarounds.

Stefan Kaluzny, Sycamore’s managing director, said in the release the transaction reflects the firm’s confidence in Walgreens’ “pharmacy-led model and essential role in driving better outcomes for patients, customers and communities.”

Walgreens will maintain its headquarters in Chicago. The company currently has more than 310,000 employees globally and 12,500 retail pharmacy locations across the U.S., Europe and Latin America, according to the release. Walgreens still plans to release its second-quarter earnings on April 8.

Walgreens’s market value reached a peak of more than $100 billion in 2015 as investors gained confidence in its health-care business and expansion plans, making it one of the most prominent American retail companies. 

But the company’s market cap shrank to under $8 billion in late 2024 due to competition from its main rival CVS, grocery chains, big-box retailers and Amazon, along with a slew of challenges. Walgreens has been squeezed by the transition out of the Covid pandemic, pharmacy reimbursement headwinds, softer consumer spending and a troubled push into health care.

Both Walgreens and CVS have pivoted from years of store expansions to shuttering hundreds of retail pharmacy locations across the U.S. to shore up profits. But unlike CVS, which has diversified its business model by offering insurance and pharmacy benefits, Walgreens largely doubled down on its now-flailing retail pharmacy business. 

In October, Walgreens said it plans to close roughly 1,200 of its drugstores over the next three years, including 500 in fiscal 2025 alone. Walgreens has around 8,700 locations in the U.S., a quarter of which it says are unprofitable. The company has also scaled back its push into primary care by cutting its stake in provider VillageMD. 

Walgreens tapped health-care industry veteran Tim Wentworth as its new CEO in late 2023 to help regain its footing. 

The company has reportedly been seen as a potential private equity target in the past. 

In 2019, private equity firm KKR made a roughly $70 billion buyout offer to Walgreens, the Financial Times and Bloomberg reported at the time. 

This post appeared first on NBC NEWS