Key Highlights

  • Four Sectors in Leading: Energy (XLE), Health Care (XLV), Communication Services (XLC) and Materials (XLB) remain in Leading.
  • Communication Services Strengthens: XLC gained 1.42% and remains among the strongest-positioned sectors.
  • Technology Remains Weakening: Technology (XLK) declined 1.55% and remains in Weakening.
  • Four Sectors in Improving: Utilities (XLU), Real Estate (XLRE), Consumer Staples (XLP) and Financials (XLF) remain in Improving.
  • Consumer Discretionary Enters Lagging: XLY moved into Lagging despite gaining 1.15%.
  • Industrials Remains Lagging: Industrials (XLI) continues to occupy the Lagging quadrant after declining 0.93%.
  • Mixed Market Performance: Five of the eleven sectors advanced, while six declined.
  • Active Sector Rotation: The RRG shows four sectors in Leading, four in Improving, one in Weakening and two in Lagging.

The latest US sector momentum visualization for 28 August 2026 shows four sectors in Leading, four in Improving, one in Weakening and two in Lagging. Energy, Health Care, Communication Services and Materials form the current Leadership group, while Utilities, Real Estate, Consumer Staples and Financials continue to show improving relative momentum.

The daily performance data also highlights a divergence between short-term price performance and broader relative momentum. Communication Services gained 1.42%, while Consumer Discretionary rose 1.15% but moved into Lagging. Technology declined 1.55% and remains in Weakening, demonstrating that daily performance alone does not necessarily determine an area's relative momentum position.

Momentum Breakdown by Quadrant

ASX Sector Relative Momentum Chart (at the closing price of 28/08/2026). Powered by: amibroker.com.

Leading: Energy, Health Care, Communication Services and Materials

Energy (XLE), Health Care (XLV), Communication Services (XLC) and Materials (XLB) remain positioned in Leading.

Energy continues to occupy a strong Leading position and gained 0.63% during the latest session, supporting its positive relative momentum profile. Health Care remains in Leading despite declining 0.24%, indicating that its relative strength remains stronger than the broader market.

Communication Services is particularly notable after gaining 1.42%, the strongest performance among the eleven sectors. Its position in Leading, combined with strong daily performance, makes it one of the key areas of current market leadership.

Materials also remains in Leading. The sector declined just 0.09%, making it relatively resilient compared with the broader market. Together, these four sectors form the current core of US sector momentum leadership.

Improving: Utilities, Real Estate, Consumer Staples and Financials

Utilities (XLU), Real Estate (XLRE), Consumer Staples (XLP) and Financials (XLF) remain in Improving.

Utilities declined 1.04%, while Real Estate fell 0.40%. Despite these negative daily returns, both remain in Improving, indicating that their relative momentum is still strengthening compared with the broader market.

Consumer Staples gained 0.43%, while Financials advanced 0.38%. Their positive daily performance provides additional support for their improving momentum profiles.

Further movement toward the upper-right of the RRG would strengthen the case for these sectors to transition into Leading. Conversely, movement back toward the centre would suggest that their relative momentum is losing strength.

Weakening: Technology

Technology (XLK) remains in Weakening after declining 1.55%, the largest fall among the eleven sectors.

The sector's RRG position indicates that its relative momentum remains under pressure. The latest decline adds to this concern and suggests that Technology has yet to regain its previous leadership characteristics.

Continued movement toward the centre and lower-right of the RRG would increase the likelihood of further deterioration. A sustained recovery in XLK would be required to indicate that its relative momentum is stabilising.

Lagging: Consumer Discretionary and Industrials

Consumer Discretionary (XLY) and Industrials (XLI) are positioned in Lagging.

Consumer Discretionary has moved from Weakening into Lagging despite gaining 1.15% during the latest session. This is an important divergence, as the sector's strong short-term price performance has not yet translated into an improvement in its broader relative momentum.

A sustained period of outperformance would be required for XLY to move back toward the centre and eventually into Improving.

Industrials declined 0.93% and remains in Lagging, indicating continued relative weakness compared with the broader US Equity market. A sustained move toward the centre of the RRG would provide the first indication of a potential recovery.

Strategic Summary

The latest US sector momentum analysis shows four sectors in Leading, four in Improving, one in Weakening and two in Lagging. Energy, Health Care, Communication Services and Materials form the current leadership group, while Utilities, Real Estate, Consumer Staples and Financials continue to show improving relative momentum.

Communication Services stands out as the strongest daily performer, gaining 1.42% while maintaining a Leading position. Energy also remains well positioned, while Materials continues to show resilience.

Technology requires close monitoring after declining 1.55% and remaining in Weakening. Consumer Discretionary is another important development, moving into Lagging despite its 1.15% daily gain. This highlights the difference between short-term price performance and broader relative momentum.

Overall, the RRG indicates an active but mixed sector rotation environment. The four sectors in Improving provide potential for broader market leadership, while continued strength in Communication Services and Energy would reinforce the current leadership structure. Meanwhile, a sustained recovery in Technology, Consumer Discretionary and Industrials would be needed to confirm a broader improvement in US sector momentum.