Industrials Point to More Gains for S&P 500: Technical Analysis

Industrial companies in the Standard & Poor’s 500 Index appear poised for additional gains that would sustain the rally that sent the index to its highest close in more than two years yesterday, WJB Capital Group Inc. said.

Of the index’s 10 groups, industrial companies and those that depend on consumer spending are the best indicators of its direction, John Roque, head of technical analysis at WJB Capital in New York, wrote in a report yesterday. While consumer discretionary companies led by McDonald’s Corp. and Walt Disney Co. are approaching a “resistance” level and may stall, industrials are about 20 percent below their 2007 record and will probably narrow the gap, Roque said.