At the close on March 10th, the S&P 500 was down 13.28% on the year. The next day the market got a nice bounce, and the index is now up 3.31% since the 3/10 close. Below we highlight the performance of the ten S&P 500 sectors during the current 3-day rally as well as their year to date performance through March 10th. As shown, the two best performing sectors since 3/10 have been Materials and Financials, while the worst performing sectors have been Health Care, Telecom and Consumer Staples.
We performed our usual decile analysis of the Russell 1,000 to see which stocks have led the rally and which ones have lagged. We broke the index into deciles (100 stocks in each decile) based on year to date performance through the 3/10 bottom. The decile of the 100 best performing stocks is decile one, while the decile of the 100 worst performing stocks is decile ten. We then calculated the average performance of stocks in each decile over the last three days and plotted the numbers in the chart below. As shown, the decile of the best performing stocks through 3/10 were the second best performers, while the decile of the worst performing stocks through 3/10 ranked first. So both momentum investors and bottom fishers have outperformed during this rally -- something we don't see happen too often.