Top scoring weekly returns:  Buy and Hold 1 Year

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The best scoring sector across our universe of 1,600 stocks is utilities. Consumer goods, industrial goods, and services also score above average.  In the services sector, focus more on large cap and mid cap stocks than on small cap stocks.

Healthcare, financials, and technology score in line. In healthcare, concentrate more on large cap stocks.

Basic materials score below average; stay stock specific.

The following chart shows sector score by market cap.

 The next chart shows four, eight, and 12 week moving average scores since 2010.

UTILITIES

Electric utilities have returned 21.09% in 2014, significantly outperforming the SPX. The average dividend increase for the utility sector in 2013 was 5.3% (median 4.1%). In the most recently reported month of August, residential electricity prices were 4% higher year-over-year.

CONSUMER GOODS

In October, industrial production of foods and clothing was 0.9% higher year-over-year.  Textiles and product mills industrial production expanded by 2.7% versus last year. In October, consumer retail clothing and clothing accessory store sales totaled $21.12 billion, up from $21.04 billion last year and $20.08 billion two years ago.

INDUSTRIAL GOODS

The U.S. Leading Indicators index for October outpaced forecasts thanks to manufacturing growth. The Conference Board’s index improved 0.9% in October, 0.3% better than estimates. New residential building permits were 1.2% higher in October versus a year ago. New residential sales grew 17% year-over-year in September.  Following elections, aerospace and defense stocks are heavily represented in our best list given that GOP control of Congress boosts the likelihood of DoD budget support. Industrials are typically strong performers relative to the SPX into year end.

SERVICES

U.S. retail and food services sales for October were 4.1% higher year-over-year. Retail sales for clothing in September posted solid growth versus last year.