Disconnect Between Commodity Prices and Stocks

Investment disconnect: all this talk about higher commodity prices, higher precious metals prices translating into higher prices for materials, precious metals stocks, and energy stocks isn't happening any more...

The S&P 500is up 2.8 percent in April. But Energy (up 0.9 percent) and Material stocks (up 1.6 percent) were big laggards. The leaders were defensive names like Healthcare (up 6.5 percent), Consumer Staples (up 5.1 percent) and Utilities (up 3.6 percent!). That's why I've emphasized the rotation aspect of the market in the last week.

One sector where you can forget rotation: financials (down 0.2 percent), still the worst performing sector.

And what about precious metals? Gold is up 9.1 percent, while the GDX (gold miners ETF) is up 5.7 percent.

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