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Markets go up and down every day. Sometimes that’s not really significant – just the ebb and flow of capital. On other days, though, there’s a real shift in key sectors.
That’s what we got today.
The tech-heavy NASDAQ had sunk more than 1.7% by 3:30 PM, whereas the broader S&P 500 had dropped just 0.7%. This tech selloff scared the pants of traders and sent them scrambling for safety.
When fear rules the markets, players move into cash or rotate into defensive sectors like utility and healthcare. We saw that rotation happen in this session.
But calling it a “rotation” doesn’t quite do it justice; this was more like a dramatic, desperate scramble. Previously “risk-on” sectors fell 3%, while defensive sectors rallied 3%. Again, this wasn’t so much a “shift” as a tectonic event.
In a moment, we’ll look at how this played out in defensives – utilities like NextEra and healthcare names like Thermo Fisher and Danaher.
Not coincidentally, we’re seeing stagflation plays start to rise; gold is up, but copper is down – we’ll look at names like Newmont and Southern Copper in a minute.
Let’s dive in…
