The narrow trade that carried us for two years is finally cracking. But here's what matters: the rest of the market isn't collapsing with it.
Last month felt dangerous. Breadth was terrible. Everything rode on a handful of names. Classic late-cycle warning sign.
Then something shifted.
The S&P 500 Equal Weight just outran the cap-weighted index by ~4 percentage points in 21 trading days. That's near the top of the range for the past year. And it's a violent reversal from September's lows.
This is what rotation looks like. Not a crash. Not capitulation. Just money finding new homes.
The question isn't whether the old leaders stumble. They will. The question is whether there's enough life in the rest of the market to keep things afloat.
Right now, the answer looks like yes.
Last month felt dangerous. Breadth was terrible. Everything rode on a handful of names. Classic late-cycle warning sign.
Then something shifted.
The S&P 500 Equal Weight just outran the cap-weighted index by ~4 percentage points in 21 trading days. That's near the top of the range for the past year. And it's a violent reversal from September's lows.
This is what rotation looks like. Not a crash. Not capitulation. Just money finding new homes.
The question isn't whether the old leaders stumble. They will. The question is whether there's enough life in the rest of the market to keep things afloat.
Right now, the answer looks like yes.
