As of Monday's close, the S&P 500 SPDR exchange-traded fund (AMEX: SPY) was down 12.25% for the year, buffeted by continuing turbulence in global credit markets and concerns over future growth prospects.
However, the relative performance of the major sector ETFs paints a far more confusing picture.
On the one hand, strength in materials and industrial shares, and weakness in the traditionally defensive health care sector, suggests that investors are not too worried about the outlook.
In contrast, strength in the consumer staples sector and weakness in technology shares indicates they are, in fact, concerned about what will happen to the economy.
So what does it all mean?
Most likely, instead of signaling what market participants see on the horizon, the disparities suggest that many are bewildered by the unfamiliar developments of recent months.
In that case, investors should tread carefully when trying to read the market's tea leaves.
Michael Panzner is a 25-year veteran of the global stock, bond, and currency markets and the author of Financial Armageddon: Protecting Your Future from Four Impending Catastrophes and The New Laws of the Stock Market Jungle.
| Sector ETF | Relative Performance vs. S&P 500 SPDR |
| Financials | -6.60% |
| Info Technology | -5.50% |
| Health Care | -0.94% |
| Utilties | 1.77% |
| Energy | 2.52% |
| Cons Discretion | 3.98% |
| Industrials | 5.31% |
| Cons Staples | 6.68% |
| Materials | 9.27% |
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