For every Beyond Meat, Inc. or Zoom Video Communications, Inc. that has held gains far above IPO pricing, there are those in pain such as The RealReal, Inc. or Lyft, Inc. But defensive plays in traditionally boring sectors have shown some astounding strength that could continue into the fall. That’s according to All Star Charts, which highlighted XLU, XLP, and XLRE in its latest client note.
“Defensive areas of the market continue to lead on an absolute basis, with REITs, Utilities, and Consumer Staples all making new all-time highs this week,” All Star Charts said. “Despite the aggressive flight to safety we’ve seen occur already, the defensive posture of market participants continues across asset classes. We’ll continue to follow price in determining the dominant trend in equities, but it seems unlikely that a sustainable breakout could occur without some of the intermarket risk appetite measures we watch begin to head in the right direction. With that being said, on an absolute basis these three sectors continue to perform well and offer opportunity on the long side.”