A Look At How Different Sectors Will Behave In 2010 (PG, KO, WMT, GSK, GILD, AZN, EXC, D, DUK)

The stock market is a volatile space, comprised of innumerable individual stocks. However, there are industries or sectors under which these stocks are categorized. A look into these broader sectors often reveals a pattern. Let’s take a look at what happened last year.

Last year, technology stocks within the S&P 500 significantly outperformed the total US stock market. The story was the same with materials stocks. While technology surged more than 50%, materials jumped 48.49%.

What about 2010? Will some industries significantly outperform the rest this year? Here are a few sectors that show potential:

Consumer Staples Stocks: The top holdings include giants like Procter & Gamble (NYSE: PG), Coca-Cola (NYSE: KO) and Wal-Mart (NYSE: WMT). Consumer spending has been decelerating in the US. However, consumers will continue to spend and these stocks have good prospects. PG rose by 15.24% in 52 weeks, KO by 24.44% and WMT by 7.41%.

Healthcare Stocks: The top holdings in the healthcare sector are GlaxoSmithKline plc (NYSE: GSK), Gilead Sciences Inc (NASDAQ: GILD) and AstraZeneca plc (NYSE: AZN). Stocks in this sector have been under pressure on account of healthcare reforms. The situation may ease with the Democrats losing the Senate super majority. S&P 500 healthcare stocks underperformed the broader market last year and currently have the lowest P/E ratio among the various S&P sectors. GSK rose by 3.05% in 52 weeks and AZN by 11.45%, while GILD declined by 10.52%.

Utility Stocks: The top holdings include giants like Exelon (NYSE: EXC), Dominion Resources (NYSE: D) and Duke Energy (NYSE: DUK). These are defensive stocks, given their steady dividends and non-cyclical nature. Utility stocks underperformed the market last year. EXC declined by 23.80% in 52 weeks, while D rose by 0.22% and DUK by 4.21%.