Equal weight Discretionary breaking out as AMZN pauses. pic.twitter.com/fCTGpErM66
— Strategas (@StrategasRP) November 12, 2020
Today’s Chart of the Day was shared on Twitter by Strategas Research (@StrategasRP). It’s a chart of the Consumer Discretionary Sector over the past 3 years on an equally-weighted basis. Amazon is by far the largest stock in the Consumer Discretionary sector, with a whopping 22% weighting. By looking at the sector on an equally-weighted basis, we get a broader view of how the average stock is performing without Amazon distorting the picture. As you can see, we’re breaking out to all-time highs this week for the first time in more than two years, even without Amazon doing the heavy lifting. This is evidence of broadening participation, which is constructive given how concerned everyone was about Mega-Cap dominance this Summer.