Industrial stocks and corresponding exchange-traded funds have been laggards this year. The Industrial Select Sector SPDR (Sector Spdr Trust Sbi (NYSE: XLI)), the largest industrial ETF, is locked in a battled with the Select Sector Financial Slct Str SPDR Fd (NYSE: XLF) for the dubious honor of the third-worst sector SPDR on a year-to-date basis.
And to this point in the year, three of XLI's marquee holdings also happen to be three of the 16 members of the Dow Jones Industrial Average that are in the red. Other data points confirm investors' reluctance to embrace cyclical industrial stocks. For example, short interest in XLI was recently as high as 59 percent of shares outstanding, according to AltaVista data. That's well ahead of the sector SPDR with the second-highest short interest – the Materials Select Sector SPDR – at 44 percent.
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