As the conflict in the Middle East rages on and consumer sentiment dips to another new all-time low, the stock market once again showed its relentless strength, hitting another new all-time high last week.
This quick turnaround from the growing dip caused by the uncertainty in Iran was once again fueled by an almost violent sector rotation. The Tech sector, more specifically Large Cap Tech, has been one of the laggards since the start of the year. Then, with just a small hint of some uncertainty dissipating, the Nasdaq went on an historic 13-day rally. The Tech sector leading the way from the bottom, pushing the US market to new all-time highs for the 7th time in 2026.
At the same time, Energy, Materials, and Precious Metals started to cool off, pulling back from their highs and pausing their uptrends for the time being. With the market making new highs and the conflict raging on simultaneously, investors must decide whether this pause offers a chance to pile into these less heavily weighted sectors. While they have proven their strength over the past six months, it's possible that this rotation is just the start and they will continue to fall out of favor.
This latest rally proves we're still in the “buy every dip” environment that began last May. The main difference this year is WHICH stocks you buy has proven to be more important than it has in years.
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