Despite a shaky start to the year, the U.S. stock market has roared ahead and is now sitting within a few percent of its all-time highs.
In an interesting example of “reversion to the mean,” the best-performing sector over the past month (basic materials) is also the worst-performing sector over the past year. Basic materials is a cyclical sector including resource industries, chemicals and precious metals, which depends on a strong economy.
Many basic materials stocks found themselves beaten down when a U.S. recession looked likely, but are now springing back based on an improved economic outlook.
