Energy Runs Against The Grain

Weakness in the Consumer Discretionary sector continues to spread, with 21.3% of the sector’s stocks trading at 52-week lows yesterday compared to none at 52-week highs. That puts the net reading at -21.3%, a new 52-week low and the weakest since 4/9/25, following Liberation Day. The sector hasn't had a net positive reading since 8/24.

Energy sits at the other end of the spectrum, with 23.8% of its stocks at 52-week highs, the highest share of any sector. Yesterday, Energy was also the only sector to close higher, rallying 1.09% to bring its YTD advance to 44.58%. Eight sessions this year have seen just one sector finish higher, and Energy accounted for six.  As shown below, that already matches its total for all of last year.

Outside of Energy, the weakness extends beyond Consumer Discretionary. Consumer Staples, Industrials, and Real Estate all closed in extreme oversold territory yesterday, bringing the number of sectors at those levels to three, the most since 3/30. Back then, five sectors were at extreme oversold levels, the highest count of 2026 and the most since the April 2025 tariff announcement.

Recent sector action has shown two sides of the same coin, as Energy’s lead has widened while more Consumer Discretionary stocks hit 52-week lows and three other sectors dip into extreme oversold territory. The gap between the year’s leading sector and the rest of the market is about more than just YTD returns.