As far as the S&P500 is concerned over the past week
Tech stocks have been suffering over the last one week, as investors try to digest the "rotation" away from tech into other sectors. The tech sector performance for the S&P500 is down by 3.88% over the last five trading days - despite yesterday's minor gain (which in fact, gains actually retraced towards the end of the day).
Bloomberg reports that momentum trades (betting on past winners to continue winning) are plunging while value trades (search for underpriced stocks) are ironically, gaining momentum as we head towards the year-end.
The report cites Societe Generale head of quantitative strategy, Andrew Lapthorne, in saying that the dump in tech stocks is also likely to be tax-related as investors are searching for companies that will benefit most from the passing of the US tax reform.
There was also a similar sell-off in tech in the middle of the year, as a slight shift of sentiment that saw financial stocks gaining. But that was more of a shift from growth stocks (tech) to value stocks (financials). That of course coincided with the move in 10-year yields at the end of June when it shot up from 2.10% to 2.30%.
S&P500 sector performance over the last five trading days. Tech stocks have been battered. Profit taking? Tax reforms? Take your pick.
