Tech rally could only stretch markets so far: Strategist

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Stock markets (^DJI, ^IXIC, ^GSPC) are showing signs of recovery following Big Tech's worst performance day of the year. To provide insight into these market dynamics, Bespoke Investment Group co-founder Paul Hickey joins Market Domination Overtime.

Hickey highlights a significant trend: the S&P 500 Equal Weight Index (^SPXEW) has underperformed the standard S&P 500 (^GSPC) index over the past six months by "one of the widest margins on record."

Addressing the tech-driven rally, Hickey says: "You can only get the rubber band so stretched before it either snaps or it just comes back." He suggests that the market pullback witnessed this week represents this "snapback" effect, a natural correction to continued tech dominance.

In light of these dynamics, Hickey sees opportunities for investors in small-caps or smaller names within the S&P 500. "Sometimes you want to have an answer to everything, but... the last couple of days just don't have really any parallels to what we've seen in the past," Hickey tells Yahoo Finance.

For more expert insight and the latest market action, click here to watch this full episode of Market Domination Overtime.

This post was written by Angel Smith

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