Our top scoring large cap stocks from 1 year ago produced an average 666 bps of excess return to the S&P 500 over the past year. The best performers from our list one year ago are CLR up 72%, EOG up 70%, SWY up 62%, WFT up 59%, and CMG up 58%.

The average large cap score this week is 58.77, below the four week moving average score of 60.91. The average large cap stock is trading -8.91% below its 52 week high, 3.93% above its 200 dma, has 4.48 days to cover held short, and is expected to grow EPS by 13.42% next year.

The best scoring large cap sector is utilities. Basic materials, healthcare, and industrial goods also score above average. Technology scores in line. Consumer goods, financials, and services score below average.

The best scoring large cap industry is cigarettes (RAI, LO, MO), followed by major oil & gas (BP, XOM, COP). Drug stores (OCR, CVS, RAD) benefit from rising Rx margins as $34 billion in branded drugs lose patent protection next year and $66 billion lose patent protection in 2015. Pipeline (SE, WMB) capacity growth and shale production upside support pipeline throughput and dividend growth. Mideast unrest (not uncommon during summer) coincides with energy demand seasonal strength to support major oil and gas and independent oil & gas companies (OXY, ECA, CHK, NBL, EOG, PXD, APC). Rail (CSX, NSC, KSU) volume continues to climb, supporting carload rates. Intermodal volume remains particularly strong.

The best scoring basics industry in large cap is major oil and gas, followed by pipelines, and independent oil & gas. In consumer goods, buy cigarettes, auto parts (MGA, TRW, ALV), and processed & packaged goods (K, GMCR, CPB, SJM). Rebounding auto demand in Europe remains a catalyst for auto suppliers. In financials, only credit services (ADS, AXP, SLM) and REITs (AVB, SLG, ESS, CPT, VNO, EQR) score above average. The top healthcare baskets are healthcare plans (WLP, CI, HUM), medical appliances (EW, RMD), and drug makers (MRK, JNJ, ALXN, NVS). Despite weight from expensive, newly approved drugs (ie. Sovaldi), insurers profit forecasts remain solid for 2014 exiting the end of the Affordable Care Act's open enrollment period. Attempts by the industry to expand subsidies to include catastrophic plans could offer additional margin and enrollment growth. Diversified machinery (DOV, CMI, ITW) and aerospace/defense (GD, SPR, LMT, BEAV, BA) score strongest in industrial goods. Summer is typically strong seasonally for defense stocks (see earlier comment regarding Mideast unrest). In services, buy drug stores, rails, and restaurants (BKW, CMG, YUM). In technology, semi equipment (LRCX, AMAT), semi ICs (TSM, SWKS), and domestic telecom (CTL, T) score highest; however, remember that the SEMI book-to-bill index historically peaks in the second quarter.