S&P500 sectors, consumer discretionary and technology hurt in March
At a particularly sensitive time for US equities, it is interesting to look at the performance of the various sectors that make up the S&P 500. The situation is particularly difficult for the consumer discretionary and technology sectors.
The situation of the S&P500 sectors until mid-March is depicted in the heat map above. Firstly, an increasingly defensive approach by investors can be observed. In January, green was prevalent. In February, buying was concentrated on primary consumer goods, real estate and energy. Recent weeks have seen losses in most sectors, with the only exception of the energy sector. Particularly noteworthy is the heavy plunge in discretionary consumption (an indicator of uncertainty about economic developments), financials and the communications sector. The technology sector is the only one to have recorded four consecutive months of decline.
If we focus our attention on the ratio of discretionary consumption to basic consumption, we can observe the trend in the strength ratio between the two sectors, as shown in the graph above. It is quite eloquent: we can see how, since the beginning of 2025, the trend has reversed and, having passed the 200-day average, the indicator has reached the lows of November last year. A weakening in the relative strength of discretionary consumption signals declining economic expectations or a significant increase in inflation.
