This is a strong breakout for REITs after months of mostly drifting in a sideways pattern. Dividend payers have been one of the best smart beta plays over the past month and have been tied closely to the moves made in staples, utilities and real estate. TIPS tend to outperform the broader fixed income market in bond bears, but long-term inflation expectations are rising again.

Crude oil prices resumed their climb last week and so did energy stocks. Materials stocks are following energy stocks much higher as the commodities rally carries on. The rotation into defensive stocks continues to pick up steam, although last week’s move was muted compared to gains over the prior two weeks.

After a brief pause a few weeks ago, energy stocks look poised to make another run at multi-year highs relative to the S&P 500. While cyclicals as a whole remain a mixed bag, the materials sector continues to steadily outperform on the heels of industrial metal and other input prices. Utilities stocks have outperformed the S&P 500 by 600 basis points over just the past two weeks.