Sectors performance in QE 1 and QE 2

When the market was in correction mode, the defensive sectors of Health Care , Consumer Staples  and Utilities  outperformed. And when the market was in rally mode, the cyclical sectors of Consumer Discretionary , Industrials , Technology , Materials and Energy outperformed. As for Financials  at the heart of the crisis, their path has been unique.

But as for sector performance coming out of the latest QE2 rally phase, a decidedly more blended picture has presented itself. While the Utilities sector is continuing to behave as expected by trailing all other sectors during the QE2 rally, both Consumer Staples and Health Care have been much more in the performance mix with the cyclical sectors. This suggests that these defensive sectors may not be set to enjoy the same outperformance post QE2 as they had in the past.