Tech’s Weakness is Good News for Stocks
Many investors may be lamenting the recent weakness of big tech stocks, and thinking that it bodes ill for the market. However, looking at the whole market, the weakness in the so-called FANGs may actually be a very healthy sign. Investors are rotating into other sectors, like banks, transport, and energy as part of a broad-based upswing in the market. The diversity of gains and improving sentiment are both positive signs, especially considering that many thought this time of year would be highly volatile.
FINSUM : If the standard defining characteristic of late stage bull markets is that gains become confined to one or two sectors, with widespread weakness elsewhere, then this is surely good news as it is exactly the opposite situation.
- bull market
- sector rotation
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.