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Market Outlook

Today's Market

Summary

The S&P 500 declined 0.5% last week, with selling concentrated in large-cap growth and AI stocks, while defensive and value names outperformed.

Short-term momentum has turned negative, but 6 of 8 tracked market indicators remain positive; I remain invested, expecting dip buyers to return soon.

Rotation favored small and microcaps, value, yield, commodities, and defensives, while Big Tech, AI, blockchain, and high-beta stocks saw outflows.

Despite recent volatility, the S&P 500 is only 2.5% off its all-time high, and long-term momentum remains marginally positive.

SlavkoSereda/iStock via Getty Images

Last week began on a positive note, with three up days in a row. Then the selling began on Thursday and continued through Friday, resulting in a 0.5% decline for the week. Suddenly, AI stocks are toxic, and defensive stocks are in demand.…