FSI Sector Allocation

FSI Sector Allocation - January 2024 Update

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Welcome to 2024. First and foremost, I hope everyone had a delightful holiday season. Since the release of our December report, the market has clearly exhibited two distinct phases. Initially, from the beginning of December until the market high on December 28th, all sectors were on the rise, particularly led by Real Estate (+9.2%), Industrials (+7.1%), and Consumer Discretionary (+6.7%). Unfortunately, the market did not break through previous highs to create new records. The anticipated Santa rally did not materialize, and since December 28th, there has been a short-term market pullback. The entire sector leadership has reversed, with previously lagging sectors such as the defensive sectors—Energy, Utilities, and Consumer Staples—leading in the recent market consolidation.

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With the arrival of the new year, we have made some adjustments to our Sector Allocation model. Broadly speaking, changes in sector weightings primarily stem from modifications to our strategic sector ratings.

Recall that our Head of Research, Thomas Lee, along with our Head of Technical Strategy, Mark Newton, released their latest 2024 year-ahead outlooks on December 7 and December 14, respectively. If yo...

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