‘Peak Pessimism’ Toward Consumer Stocks Flashes a Buy Signal

Recent market performance for US consumer-discretionary stocks has been so ugly that it may be a great time to buy.

Such is the conclusion of an analysis done by researchers at SentimenTrader. More than 50% of stocks in the S&P 500 Consumer Discretionary Index are trading 20% below their 252-day highs. That setup has preceded a 14% average rally in the next year, with the index pushing higher in 23 of the 28 prior cases, the firm’s analysis show.