The recent shift out of defensives is clearly highlighted when looking at the percentage of stocks above their 50-day moving averages by sector. In the entire S&P 500, 80% of stocks are currently above their 50-day moving averages. But all four defensive sectors -- Telecom, Consumer Staples, Health Care, Utilities -- have breadth readings below 80%.
The most defensive sector of them all -- Utilities -- has seen breadth fall of a cliff. As shown below, just 39% of Utilities stocks are currently above their 50-days, which is 24 percentage points below the next closest sector. During the early part of the current market rally in June and July, Utilities stocks were actually leading, and well over 90% of Utilities stocks were above their 50-days as recently as ten days ago. The dynamic has clearly changed over the past two weeks, however, and now it's all the cyclical sectors that are leading.