Over the last few weeks we have watched the scrolling ticker tape in amazement as the Materials Select Sector SPDR (XLB Quote) and Vanguard Materials ETF (VAW Quote) have taken off to new highs. So far this year, these sector ETFs returned 7.4% and 8.3% respectively.
The top five stocks in these two ETFs include a who's-who of large-cap diversified chemicals and metals. These highly rated stocks include E.I. du Pont de Nemours (DD Quote), Dow Chemical (DOW Quote), Alcoa (AA Quote), Monsanto (MON Quote) and Phelps Dodge (PD Quote).
Now, there is nothing wrong with investing in this quintet of large-cap materials stocks. Our quantitative model loves the excess cash these companies are generating and their collective recent spurt of top-line growth. They are all rated buy, and they give you exposure to basic materials. ...
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| Dow Jones | S&P 500 | NASDAQ | 10-Year Note | |
|---|---|---|---|---|
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