"Cyclical-oriented stocks, which are sensitive to economic shifts, continue to exhibit bullish market breadth profiles, indicating that investors are confident in economic growth prospects," said Dean Christians, senior research analyst with SentimenTrader, in a report Tuesday.
Christians noted that more than 15% of the S&P 500's consumer discretionary, financial, and industrial stocks hit a 52-week high on Friday. That is only the 31st time this has happened since 1954, and it's usually a healthy sign for future returns, he says. The average gain for the S&P 500 over the next 12 months in those instances was 13.4%.
Christians pointed out in another report Tuesday that more than 30% of the stocks in the financial and industrial sectors hit 52-week highs on Monday. That has occurred just 21 times in the past 70 years.