While Google ( GOOG ), Caterpillar ( CAT ), and other big technology and industrial names have recently helped push stocks to their best levels in three months, the rally off of the March 20 th bottom may not have the kind of sector composition behind it that is conducive to an extended move. In fact, so far the bull run has been largely the result of strong performance in the energy and materials sector – a good portion of which can be attributed to the search for a hedge against inflation. The chart below shows the performance of the nine AMEX Select Sector SPDRs relative to the S&P 500 index since the March 20 th bottom. The sectors normally associated with an economic turnaround – technology ( XLK ), industrials ( XLI ), and consumer discretionary ( XLY ) – have heretofore not been leading the charge. On the other hand, the leading sectors over the past month – energy ( XLE ) and materials ( XLB ) – are not the sectors that typically are able to lead a sustainable rally. In the next week or two, look for other sectors to start outperforming the energy and materials group. If this fails to happen, there will probably not be sufficient market breadth to keep the current rally alive.