Sector Views: Our Stock Sector Outlook

Liz Ann Sonders and Kevin Gordon discuss the evaluation of various sectors of the economy and the relaunch of Schwab Sector Views, which provides perspective and ratings on the 11 sectors of the S&P 500. The new version of Sector Views incorporates a quantitative and qualitative approach, using factors such as growth, quality, sentiment, stability, and valuation to determine sector rankings. The ratings are based on a 6-to-12-month time horizon. Currently, the outperform sectors are energy, financials, and materials, while real estate and consumer discretionary are underperforming. Kevin emphasizes the importance of considering concentration risk and using sector views as a tool for informed decision-making.

Additionally, Kathy and Liz Ann discuss the recent PCE report and its impact on the stock market. They also talk about the Fed's data-dependent approach and the factors that influence Fed decisions. They mention upcoming economic data, including the CPI and PPI reports, as well as the small-business survey.

To learn more about stock sectors and how they are defined, check out "Stock Sectors: What Are They? How Are They Used?" 

The show will be on break next week but will return with a new episode on March 22.

On Investing is an original podcast from Charles Schwab. For more on the show, visit schwab.com/OnInvesting.

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Important Disclosures

The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision. 

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third-party providers is obtained from what are considered reliable sources. However, its accuracy, completeness, or reliability cannot be guaranteed. 

Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.

All corporate names and market data shown above are for illustrative purposes only and are not a recommendation, offer to sell, or a solicitation of an offer to buy any security. Supporting documentation for any claims or statistical information is available upon request. 

Investing involves risk, including loss of principal.

Performance may be affected by risks associated with non-diversification, including investments in specific countries or sectors. Additional risks may also include, but are not limited to, investments in foreign securities, especially emerging markets, real estate investment trusts (REITs), fixed income, small capitalization securities and commodities. Each individual investor should consider these risks carefully before investing in a particular security or strategy.

The Schwab Center for Financial Research is a division of Charles Schwab & Co., Inc.

The policy analysis provided by the Charles Schwab & Co., Inc., does not constitute and should not be interpreted as an endorsement of any political party.

The information and content provided herein is general in nature and is for informational purposes only. It is not intended, and should not be construed, as a specific recommendation, individualized tax, legal, or investment advice. Tax laws are subject to change, either prospectively or retroactively. Where specific advice is necessary or appropriate, individuals should contact their own professional tax and investment advisors or other professionals (CPA, Financial Planner, Investment Manager) to help answer questions about specific situations or needs prior to taking any action based upon this information.

The Taylor rule prescribes a higher federal funds rate when inflation is above the Fed's inflation target, and a lower one if inflation is lagging.

Past performance is no guarantee of future results and the opinions presented cannot be viewed as an indicator of future performance.

Concentration risk is the potential for financial loss due to an overexposure to a single stock, sector, or geographic region.

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