These sectors and stocks dominated Wall Street's 2023 gains

2023 was a standout year for stocks with the S&P 500 surging 25 percent, well above the average return of 10%. But it wasn’t just tech that led the gains this year -- TheStreet’s J.D. Durkin breaks down which sectors popped and which sectors flopped throughout 2023.

Full Video Transcript Below:

J.D. DURKIN: By most measures, 2023 has been a banner year for the stock market. The S&P 500 is up 25%, compared to the average return of about 10%. And it’s just not those splashy tech names like Nvidia and Amazon doing all the heavy-lifting, either: when you even out all the components in the S&P 500 – or, their equal weighted average – the index is still up 10% this year. Even companies with smaller market caps got in on the action late in the year, as did the good old fashioned Dow.

But how did each segment within the S&P do this year? Which sectors outperformed – driving the markets to new highs – and which ones hobbled across the New Year’s finish line?

As you can see here… not all sectors were created equally in this year’s market. There were three stand-out winners this year, which shouldn’t be a surprise, considering the “magnificent 7” names are all found in these three sectors: Amazon and Tesla are consumer discretionary juggernauts… Microsoft, Apple, and Nvidia are all key technology names… while Meta and Google are highly-weighed communication services companies.

Four other sectors are also set to close out 2023 in the green, though trail the overall S&P performance. These include industrials and financials, which counts names like Berkshire Hathaway and JP Morgan Chase in its holdings. Materials and real estate have also both bounced off their October lows and will finish 2023 in positive territory.

As for the laggards… it’s been a tough year for our final group of S&P 500 sectors. Consumer staples has been hit by Proctor and Gamble’s falling stock this year, though also includes stalwarts like Walmart and Costco. Energy and healthcare stocks are set to close the year lower, while the utilities sector is the caboose of this year’s market train: down more than 9% in 2023.

2023 will go down as a wild one for the stock market – and if you missed out, you’re probably not alone. This time last year, not many saw the market performing this well. In December 2022, Goldman Sachs forecasted that by now – December ‘23 – the S&P would end the year at 4,000. And industry bear Mike Wilson at Morgan Stanley had his target even lower, at 3,900. Instead, we’re looking at a market about 18% higher