This Materials ETF Is A Clear Outperformer So Far In 2017

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January 25, 2017 9:25am NYSE:XLB

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From Taki Tsaklanos: The materials sector (XLB ETF) was up 2.7 percent on Tuesday. So far, it is one of the outperforming sectors in 2017.

Forbes correctly identified 2 key outperformers in the materials sector notably copper miner Freeport-McMoran (FCX) and agriculture stock Mosaic Co (MOS). FCX and MOS make up approximately 5.6% of the underlying holdings of XLB.

The drivers within the materials sector are currently copper and agriculture. Investors are accumulating the stocks in those segments.

Some analysts believe that this part of the “Trump effect.” CNBC wrote recently that “Oppenheimer told investors Donald Trump’s policies will benefit the financial outlooks of industrials and materials companies and boost the sectors’ share prices in 2017.”

Regardless of what analysts say, the market has chosen a clear direction. The materials sector chart shows how the sector has risen to all-time highs this week. Although the weekly chart below only shows the last 5 years, the longer term chart has a similar conclusion as the 2008-highs were significantly lower than today’s level.

materials stock market sector all time highs 2017

The Materials Select Sector SPDR (NYSE:XLB) rose $0.15 (+0.29%) in premarket trading Wednesday. Year-to-date, XLB has gained 5.96%, versus a 2.22% rise in the benchmark S&P 500 index during the same period.

XLB currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #2 of 32 ETFs in the Industrials Equities ETFs category.

This article is brought to you courtesy of Investing Haven.

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