The S&P 500 just closed at another new all-time high. Again.
That’s exactly the kind of behavior you expect in a healthy bull market. New highs don’t show up once – they tend to cluster.
Another hallmark of strong bull markets is rotation. Leadership doesn’t stay bottled up in the same handful of stocks forever.
Participation broadens. Different sectors take turns carrying the tape.
One area that hasn’t gotten much attention this year is large-cap Materials.
Yes, the Metals & Mining names we own have been absolute monsters in 2025. But most of them are simply too small to qualify for the large-cap sector indexes.
The Gold, Silver – and especially Platinum and Palladium – miners tend to live outside that universe.
In fact, only one major Gold miner, Newmont (NEM), makes it into the S&P 500 Materials Index – and it’s the exception, not the rule.
What actually drives the Materials sector at the large-cap level is Specialty Chemicals. And until recently, that group has gone absolutely nowhere.
That’s starting to look like it may be changing.
Secular Uptrend in Materials
Below is the large-cap State Street Materials Select Sector SPDR ETF (XLB), still working through a massive, multi-year consolidation – and now pressing up against the top of that range:
The long-term trend is clearly higher.
What’s notable is the time component. This consolidation has been building for more than 40 months.
That’s a long time for prices to go essentially nowhere. Markets don’t do that forever.
If Materials are ever going to make a meaningful move, the setup suggests it’s getting close.
And as we always say around here, “The bigger the base, the higher in space.”
Long, frustrating consolidations tend to resolve with force once they finally give way.
Over the past three-plus years, Materials haven’t gone anywhere:
That kind of inactivity doesn’t signal weakness. It signals stored energy.
And it feels like it’s time.
There’s No Material Impact
Let’s be honest: A breakout in Materials probably isn’t going to move the entire market.
The sector only makes up about 1.5% of the S&P 500 and roughly 1% of the Nasdaq 100. This isn’t about shifting the index. It’s not that kind of story.
This is about rotation.
It’s about participation broadening out beneath the surface. And that’s exactly what healthy bull markets do.
Leadership rotates. New groups wake up. Everyone eventually gets a turn.
There are still plenty of stocks that haven’t meaningfully participated in this bull market yet – and a surprising number of them live inside the Materials complex.
If this group finally resolves higher, it’s another checkmark in the “bull market doing bull market things” column.
No fireworks. No drama. Just the tape quietly doing its job.
And with that, Merry Christmas. 🎄
May your trends stay intact, your bases resolve higher, and your charts do the heavy lifting in the year ahead.
Stay sharp,
JC Parets, CMT
Founder, TrendLabs