All 11 market sectors of the S&P 500 up<\/h2>\n\n\n\n
The S&P 500 can be divided into 11 market sectors. An ETF is available for each of these sectors, which can be used for both investment and analysis. Below we compare the performance of the individual market sectors with the S&P 500 ETF (SPY) over the last 52 trading weeks, more precisely from January 02, 2025 to January 02, 2026: <\/p>\n\n\n\n
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- The SPY rose 18.23 %.<\/li>\n\n\n\n
- All 11 market sectors are up.<\/li>\n\n\n\n
- The Technology (+25.19%), Industrials (+21.97%) and Communication Services (+21.63%) sectors were particularly strong. These three market sectors are offensive or pro-cyclical sectors. Only Consumer Discretionary, another important offensive sector, was weaker than the index.<\/li>\n\n\n\n
- The three most important defensive sectors (Consumer Staples, Health Care and Utilities) were also strong, but underperformed the index and in particular the offensive market sectors.<\/li>\n<\/ul>\n\n\n\n
![\"Bar](\"https:\/\/www.captrader.com\/wp-content\/uploads\/2026\/01\/image-1-1024x373.png\")
SPY and the eleven sector ETFs of the S&P 500 (absolute performance, Jan. 2, 2024 - Jan. 2, 2025)<\/figcaption><\/figure>\n\n\n\n The bottom line is that the offensive market sectors led the way last year and the defensive sectors showed relative weakness. The relative performance of the individual sectors compared to the SPY becomes particularly clear when we visualize the outperformance\/underperformance on a relative level with a performance chart.<\/p>\n\n\n\n
![\"Bar](\"https:\/\/www.captrader.com\/wp-content\/uploads\/2026\/01\/image-1024x373.png\")
Relative performance of the eleven sector ETFs of the S&P 500 (Jan. 2, 2024 - Jan. 2, 2025)<\/figcaption><\/figure>\n\n\n\n This is exactly the kind of development we want to see in a healthy bull market (outperformance of offensive sectors, underperformance of defensive sectors). As long as nothing changes in this picture and the pro-cyclical sectors continue to lead the way, the long-term uptrend should not be in danger.<\/p>\n\n\n\n
Profit growth at record level<\/h2>\n\n\n\n
Social networks are currently full of posts pointing out the high valuation of the stock market and the S&P 500 and warning of a stronger correction as a result. <\/p>\n\n\n\n
While a correction of +\/- 10 % is certainly possible at any time and is historically the rule rather than the exception, one must not forget that the high valuation is not just pure hype based on fantasy, but is supported by real earnings growth.<\/p>\n\n\n\n
It is also worth taking a sober look at the valuation figures: Depending on the definition, the current P\/E ratio of the S&P 500 (trailing, last 12 months) is around 31, which seems high at first glance. However, if you look at the forward P\/E ratio (earnings over the next 12 months), which is often more important in practice, the market currently stands at around 22, which is also above the historical average range: FactSet puts the 10-year average forward P\/E roughly at 18.6 (5-year average around 19.9). <\/p>\n\n\n\n
However, it is crucial that this valuation is not viewed in isolation, but in relation to the companies' earnings growth: For 2025, the expected earnings growth of the S&P 500 is around +12% according to the FactSet consensus, and for 2026, the current forecast is even around +15%; both clearly above the long-term earnings growth average.\u00a0<\/p>\n\n\n\n
This is precisely why the market can remain stable despite ambitious multiples: as long as companies deliver (and there are no surprising headwinds from inflation\/interest rates), an expensive market is not automatically an overheated market. The risk only arises when expectations become too high and reality no longer catches up with them.<\/p>\n\n\n\n