ASX Sector Momentum Update: Six Sectors Lead While Six Remain in Lagging

Robert Luong

25 August 2026 09:44 AM AEST

ASX Sector Momentum Update: Six Sectors Lead While Six Remain in Lagging

Image Source: Shutterstock

You are reading a free article with opinions that may differ from the recommendation given by Kalkine in its paid research reports. Become a Kalkine member today to get access to our research reports, in-depth technical and fundamental research. Learn more

Start Your Free Trial Now!

Key Momentum Shifts

Six Sectors Remain in Leading: Health Care (XHJ), Information Technology (XIJ), Materials (XMJ), Resources (XJR), Utilities (XUJ) and Energy (XEJ) remain positioned in the Leading quadrant.
Health Care Maintains the Strongest Position: Health Care (XHJ) remains the furthest into the upper-right area of the RRG, indicating the strongest relative momentum.
Information Technology Remains Strong but Moderates: Information Technology (XIJ) remains firmly in Leading, although its downward trajectory signals moderating relative momentum.
Materials and Resources Maintain Leadership: Materials (XMJ) and Resources (XJR) remain among the strongest sectors, supported by constructive relative momentum.
Utilities Remains in Leading: Utilities (XUJ) continues to hold a Leading position, although its trajectory requires monitoring as it moves closer to the centre.
Energy Remains a Less Established Leader: Energy (XEJ) remains in Leading but is positioned relatively close to the centre of the RRG.
Six Sectors Remain in Lagging: Financials (XFJ), Consumer Discretionary (XDJ), Real Estate (XPJ), Communication Services (XTJ), Consumer Staples (XSJ) and Industrials (XNJ) remain in the Lagging quadrant.

The latest Relative Rotation Graph (RRG) for 24 August 2026 shows a concentrated momentum structure across the Australian Equity market. Six sectors remain in Leading, while six sectors remain in Lagging. No sectors currently occupy either Improving or Weakening.

The chart continues to demonstrate a clear separation between the market's relative leaders and weaker sectors. Health Care remains the strongest momentum area, while Materials and Resources continue to occupy prominent positions within Leading. Information Technology remains a strong leader but its downward trajectory indicates that its relative momentum is moderating.

Momentum Breakdown by Quadrant

ASX Sector Relative Momentum Chart (at the closing price of 24/08/2026). Powered by: amibroker.com.

Leading Quadrant

Health Care (XHJ), Information Technology (XIJ), Materials (XMJ), Resources (XJR), Utilities (XUJ) and Energy (XEJ) are currently positioned in the Leading quadrant.

Health Care (XHJ) maintains the strongest position within the Leading group. Its location near the upper-right area of the RRG indicates strong relative strength and momentum. However, its recent trajectory has turned downward, suggesting that momentum is beginning to moderate despite the sector remaining firmly established as the strongest area of the market.

Information Technology (XIJ) also remains firmly positioned in Leading. Its trajectory is pointing downward, indicating that relative momentum has weakened from its previous direction. Although the sector remains a clear leader, continued downward movement could increase the risk of a future rotation toward Weakening.

Materials (XMJ) remains positioned within Leading and continues to display strong relative momentum. The sector's position is supported by its strong recent performance, with Materials gaining 2.43% on 24 August. Its location within the Leading quadrant confirms that the sector remains one of the principal sources of positive market momentum.

Resources (XJR) also remains in Leading and is positioned close to Materials. Resources gained 2.26% during the latest session, reinforcing its strong momentum profile. Its position within the upper-right quadrant indicates that commodity-related sectors continue to attract significant market support.

Utilities (XUJ) continues to hold a Leading position, although its trajectory has moved closer to the centre of the RRG. The sector remains above both midlines, but its direction should be monitored for evidence of either renewed strengthening or a potential loss of relative momentum.

Energy (XEJ) remains in Leading but is positioned considerably closer to the centre of the RRG than Health Care, Materials and Resources. This indicates that its Leadership is less established. Continued movement toward the upper-right would strengthen its position, while a rotation toward the centre could signal fading momentum.

Overall, the six sectors in Leading continue to represent the market's strongest relative momentum group. Health Care remains the most established leader, while Materials and Resources are supported by particularly strong recent momentum. Information Technology warrants closer monitoring because of its downward trajectory, while Utilities and Energy remain closer to the centre of the RRG.

Lagging Quadrant

Six sectors are currently positioned in Lagging: Financials (XFJ), Consumer Discretionary (XDJ), Real Estate (XPJ), Communication Services (XTJ), Consumer Staples (XSJ) and Industrials (XNJ).

Financials (XFJ) remains the deepest position within the Lagging quadrant, indicating particularly weak relative momentum compared with the broader ASX sector universe. The sector also declined 0.72% during the latest session, reinforcing its relatively weak momentum profile.

Consumer Discretionary (XDJ) and Real Estate (XPJ) also remain below the RRG midlines, confirming weaker relative momentum. Their positions indicate that these sectors have yet to generate sufficient relative strength to move toward the Improving quadrant.

Communication Services (XTJ), Consumer Staples (XSJ) and Industrials (XNJ) are similarly positioned in Lagging. While their relative positions are not as weak as Financials, they remain below the key RRG midlines and therefore have not yet established a meaningful momentum recovery.

The key issue is that none of the six Lagging sectors has crossed into Improving. Until their trajectories demonstrate sustained movement toward the centre of the RRG, there is limited evidence of a broad-based recovery in relative momentum.

The concentration of six sectors in Lagging therefore continues to highlight the narrow distribution of positive momentum across the Australian equity market.

Strategic Summary

The latest RRG shows that ASX sector momentum remains concentrated, with six sectors positioned in Leading and six in Lagging. No sectors are currently in either Improving or Weakening.

Health Care remains the strongest relative momentum sector, while Materials and Resources continue to demonstrate strong leadership. Information Technology remains firmly in Leading but its downward trajectory warrants monitoring. Utilities and Energy also remain in Leading, although their positions closer to the centre make their future trajectories increasingly important.

Meanwhile, Financials, Consumer Discretionary, Real Estate, Communication Services, Consumer Staples and Industrials remain in Lagging. The absence of any sectors in Improving indicates that momentum has not yet broadened beyond the existing leadership group.

Overall, the RRG continues to point to a divided sector momentum environment, with strong leadership concentrated in Health Care, Materials, Resources, Information Technology, Utilities and Energy, while the remaining six sectors continue to lag the broader ASX sector universe.

Download Free Report – Explore 3 Stock Ideas & Industry Insights

Unlock 3 stock ideas and key industry insights in our free report. This information is general in nature and does not consider your personal objectives, financial situation, or needs. It is not financial advice.

All investments involve risk—consider independent advice before making any investment decisions.

View 3 Research Reports

Disclaimer:

This article (“Article”) has been prepared by Kalkine Pty Limited (ABN 34 154 808 312) (Australian financial services licence number 425376) (“Kalkine”) and its related bodies corporate who are authorised to provide general financial product advice. Kalkine.com.au and its associated pages are published by Kalkine.

Any information/advice provided in this article is general in nature and does not take into account your objectives, financial situation or needs. You should therefore consider whether the information is appropriate for your objectives, financial situation and needs before acting upon it.

There may be a Product Disclosure Statement, Information Memorandum or other offer document (“Offer Document”) for the securities or other financial products referred to in Kalkine articles. You should obtain a copy of the Offer Document and consider it before making any decision about whether to acquire the security or financial product.

Kalkine strongly recommends that you seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) before acting on any advice/information in this Article or on the Kalkine website. Not all investments are appropriate for all people.

The information in this Article and on Kalkine website has been prepared from a wide variety of sources, which Kalkine, to the best of its knowledge and belief, considers accurate. Kalkine has made every effort to ensure the reliability of the information contained in its articles (including this Article), newsletters and websites. All information represents our views at the date of publication and may change without notice.

The information in this Article does not constitute an offer to sell securities or other financial products or a solicitation of an offer to buy securities or other financial products.

Kalkine does not issue, sell or deal in any financial products.

This Article may contain information on past performance of particular investments. Please note past performance is neither an indicator nor a guarantee of future performance.

To the extent permitted by law, and excluding any dishonesty or gross negligence by Kalkine, Kalkine disclaims and excludes all liability for any direct, indirect, implied, punitive, special, incidental or other consequential loss or damage arising from the use of or reliance on this Article, the Kalkine website and any information published on the Kalkine website without any warranties or representations by Kalkine to you. To the extent the law prohibits or limits this exclusion, Kalkine limits its liability to the resupply of services.

Please also read our Terms & Conditions and Financial Services Guide for further information.

Employees and/or associates of Kalkine and its related entities may hold interests in the securities or other financial products covered in this Article or on the Kalkine website. Any such employees and associates are required to comply with certain safeguards, procedures and disclosures as required by law.

Some of the images/music that may be used in the Article are copyright to their respective owner(s). Kalkine does not claim ownership of any of the pictures displayed/music used in the Article unless stated otherwise. The images/music that may be used in the Article are taken from various sources on the internet, including paid subscriptions or are believed to be in public domain. We have used reasonable efforts to accredit the source wherever it was indicated or was found to be necessary.

Kalkine Media Pty Ltd, an affiliate of Kalkine Pty Ltd, may have received, or be entitled to receive, financial consideration in connection with providing information about certain entity(s) covered on its website.