Just think how often bad news about a dominant player drags down the stock prices of its competitors or suppliers. Brocade wasn't downgraded, but its stock acted as if it had been. Sector drivers are critical to investing success. Yet, the word sector is one of those terms everyone uses yet no one seems to know what it means. What Works Screens the Stock Screeners Stock Screeners Are Good, but Not Fail-Safe.
Airlines compose a sector.
So do camera manufacturers. And the companies within either of those sectors compete with one another. But sectors can be broader. The key here is that Wall Street analysts have grouped these stocks together in some way. And as one trades, its peers tend to follow suit.