A Glimpse into Stock Market Sectors, Pt. 2

February 4th, 2021

If you read our emails last week, you would find that we started discussing the 11 different sectors in the stock market. So far, we have covered energy and materials. Today, we'll keep diving into three new sectors.

Industrials

In the Industrials Sector, you will find companies that generally involve the use of heavy equipment. Companies in this sector include airlines, railroads, and logistics companies. You will also find companies in the aerospace, defense, construction, and engineering industries. Companies making building products, electrical equipment, and machinery also fall into this sector.

Stocks in the Industrials Sector include Boeing (NYSE: BA) and Union Pacific (NYSE: UNP).

Utilities

The utilities sector covers pretty much every different type of utility company you can think of. In this sector, you will find your electrical lighting companies, as well as specialists in natural gas transmission and distribution. Other utilities include companies that provide water to their surrounding areas. In addition, independent producers of power and renewable electricity also land in the utilities sector, even though they don't exactly resemble the traditional regulated utility in an era of deregulation.

Utility companies tend to be regional. So if you live in Florida, a good example of the utility company in the stock market would be Florida Power and Lighting (NYSE: FPL). If you live in Ohio, then a good example would be American Electric Power (NYSE: AEP) or, if you live in Northern California, Pacific Gas & Electric (NYSE: PGE).

Healthcare

There are two primary components in the health sector. One component includes companies that develop pharmaceuticals and treatments based on biotechnology, as well as the analytical tools and supplies needed for the clinical trials that test those treatments. The other encompasses healthcare equipment and services, including surgical supplies, medical diagnostic tools, and health insurance.

Examples of healthcare stocks include Pfizer (NYSE: PFE), Johnson & Johnson (NYSE: JNJ), and UnitedHealth Group (NYSE: UNH).

Check back next week as we go over the rest of the stock market sectors.

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