4) Chemicals and Mining
"Chemicals are spending much more. Mining is spending about 20 percent more as well," Levkovich says. "That's going to put downward pressure on those commodities ."
The Dow Jones US Chemicals Index has been underperforming the S&P 500 since September 2011.
5) Health Care
"I'm not a big-fan of health care. Budgets will keep that under pressure," he says. "But, more importantly, the spread between cash flow yields and junk bond yields is about [4 percent]."
"Cash flow yield" is simply the amount of cash flow each share earns. The higher this yield is, the better able the company is to finance its activities. By contrast, "junk bond yields" indicates that the company is needing to borrow.
High corporate funding costs are, for Levkovich, separating the winners from the losers, who encourages investors to follow sector spending levels.
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According to Citigroup policy, no part of Tobias Levkovich's compensation was, is, or will be, directly or indirectly, related to the specific recommendations expressed by him in public appearances.