This huge chasm between the overall index and its bottom three sectors is actually the largest gap seen in at least decades, according to Fundstrat Global Advisors. Using data going back to 1990, Fundstrat strategist Tom Lee found that the largest average underperformance by the three worst-performing sectors in any prior year has been the 15.3 percent seen in 1991.
In addition, Lee found that "in the past 30 years, never have we
For Erin Gibbs, a portfolio manager at S&P Global, the commonality among the three sectors is that they "had big runups, particularly in the fourth quarter of last year."
"I think for most of these, we're really coming down to reasonable valuations and reasonable pricing," Gibbs said Friday on CNBC's "Trading Nation." What we are now witnessing is an "unwinding of sentiment."
Financials, in particular, are "coming off of frothy valuations" after the 20 percent rally the sector enjoyed in the fourth quarter thanks to optimism surrounding Donald Trump's election and Fed rate hikes.
Meanwhile, energy stocks are obviously responding to the slip in oil prices.
In terms of strategy, Lee suggests an intriguing one: He recommends investors pair the surging "FANG" stocks (Facebook, Amazon, Netflix and Google parent Alphabet) with holdings in the energy, financials and telecom sectors.
In other words, invest in what's been working — as well as in what really hasn't.