Charts of the Week

S&P 500 Index Sector Performance (as of 09/30/18)

Chart of the Week for October 12, 2018 - October 18, 2018

All 11 S&P 500 Index sectors rose in the twelve month period ended September 30, 2018, compared to 10 of the 11 sectors posting positive returns in the twelve month period ended September 30, 2017.

Similar to the stock market as a whole, returns for individual sectors of the stock market experience fluctuations. For example, a sector may outperform other sectors for a period of time and then underperform in subsequent periods. The chart above compares the performance of the Standard & Poor's 500 Index ("S&P 500"), including dividends, to its 11 underlying sectors for the twelve month periods ended September 30, 2018 ("current" period) and September 30, 2017 ("prior" period). The S&P 500 is an index consisting of 500 companies representing larger capitalization stocks traded in the U.S. and is a benchmark commonly used to measure the performance of the U.S. stock market.

The S&P 500 rose 17.91% for the current period, and all 11 sectors posted positive returns, with five of those sectors posting double digit returns. In comparison, the S&P 500 rose 18.61% for the prior period, and 10 of the 11 sectors posted positive returns.

Only three sectors outperformed the S&P 500 in the current period led by Consumer Discretionary (32.54%), Information Technology (31.49%), and Health Care (18.35%). Consumer Staples (2.93%) and Utilities (2.93%) were the lowest performing sectors in the current period. Generally improving U.S. economic conditions and U.S. tax policy that cut corporate tax rates and increased corporate earnings helped drive the strong returns.

Market and sector returns fluctuate from year to year depending upon a variety of factors, which are very difficult to forecast. Therefore, it is important to understand the principles of investing before establishing an investment strategy to help ensure that it is consistent with your personal goals, risk tolerance, and time horizon.

© Copyright 2018 ICMA Retirement Corporation, All Rights Reserved. This information is intended for educational purposes only and is not to be construed as investment advice or a solicitation to buy or sell securities. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed here. Past performance is not necessarily indicative of future performance.

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