S&P 500 Sector Performance (as of 3/31/09)

Chart of the Week for April 09 - April 16, 2009

Similar to the stock market as a whole, returns for individual sectors of the stock market may go up and down. A sector may outperform over an extended period and then underperform in subsequent periods. The chart above compares the performance of the S&P 500 Index to its ten underlying sectors for the years ended March 31, 2008 and March 31, 2009.

For the year ended March 31, 2009, the overall S&P 500 Index, an index consisting of 500 companies representing larger capitalization stocks traded in the U.S., returned -38.08% with every sector posting a loss. Of all the sectors, the Financials sector retreated the most with a negative return of -63.03%. The Materials and Industrials sectors also experienced significant losses with negative returns of -45.11% and -50.51%, respectively.

The Financials sector was the worst-performing sector in both time series depicted above. The 2007 subprime mortgage crisis continued into 2008, spreading to the credit markets and weakening the broader global economy. The failure of Lehman Brothers in September 2008 also dealt a blow to investors, leading to significant losses for the broader market as a whole. The Healthcare sector was the best performing sector in the year ended March 31, 2009, posting a -19.74% return.

Market and sector returns fluctuate from year to year depending upon a variety of factors, which are hard to predict. Therefore, it is important to understand the principles of investing before establishing an investment strategy to be sure that it is consistent with one's personal goals and time horizon. As the past twelve months have shown, all sectors can produce negative returns and investing includes the possibility of losses as well as gains.

This illustration was compiled by information from outside sources. These companies are not affiliated with ICMA-RC. This information is being provided for educational purposes and is not intended to be construed as or relied upon as investment advice. ICMA-RC does not offer specific tax or legal advice. Individuals are advised to consider any new investment strategies carefully prior to implementing.

Investment information can change rapidly and the changes can be significant particularly in volatile markets. For this reason “as of”’ dates are provided for specific data where applicable. The information should not be considered current after the dates provided.

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The performance data quoted represents past performance. Past performance is no guarantee of future results. Investment returns and principal value will fluctuate, so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data illustrated. For performance data current to the most recent month end, contact ICMA-RC Services, LLC by calling 800-669-7400 or by writing to 777 North Capitol Street, NE, Washington, DC 20002-4240. Para asistencia en Español llame al 800-669-8216. Performance data current to the most recent quarter end is available by visiting www.icmarc.org.