My reasoning is that resource stocks have a very strong run (the materials sector was up 35.8% last year) while bank stocks appear to be close to fully priced.
Coca-Cola underperformed the market last year, while stocks like Pfizer continued a five-year roll.
Consumer staple analyst Wendy Nicholson at Citi did some research and noticed that for the ten years leading up to 2000 beverage stocks had outperformed the broader market in Q4, while in the last ten years that pattern has reversed, and beverage stocks underperformed the market for seven of the ten.
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Stocks tried to stabilize last week while the Euro crisis simmered on the back burner.
According to the investment bank's research, while 63 percent of stocks that beat analysts' forecasts last week performed better than the overall market the next day, 73 percent of those that missed targets performed worse.
Stocks surprised the market skeptics last week because while most of the major averages showed little change, the market did not go down as most expected.
While the falling dollar has helped investments in foreign stocks over the last decade or so, there have been periods in the past where a rising dollar caused huge headwinds, and certainly losses in many cases, for foreign stocks.
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Traditional Brazil investors have done poorly, while investors who were picking up consumer stocks traded on the Bovespa stock exchange last year did well if they had access to a local broker.
While it would be nice to believe that markets are trading on fundamentals, stocks increased last year in an environment of mostly flat earnings and decelerating economic growth.
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