Mixed action as late week tech rally lifts markets
The stock market finished the week with mixed results as investors navigated swings in mega-cap tech and AI-related names, sector rotation, and some highly anticipated data releases that had minimal impact on expectations for near-term monetary policy.
The S&P 500 (+0.1% WTD), DJIA (-0.7% WTD), and Nasdaq Composite (+0.5% WTD) reflected divergent trends across large-cap indexes, while smaller-cap benchmarks were relatively subdued: the Russell 2000 (-0.9% WTD) underperformed, and the S&P Mid Cap 400 remained flat.
Stocks in the information technology sector (+0.5% WTD) led both the volatility and the week’s headlines. Early-week weakness in Oracle and Broadcom extended their post earnings slide despite positive guidance. Micron’s blowout earnings midweek sparked a reversal in the AI trade, sending chipmakers higher and giving the sector a late boost.
Cyclical sectors showed pockets of strength amid the turbulence in tech. The consumer discretionary sector (+1.0% WTD) benefited from gains in travel, leisure, and mega-cap names such as Tesla. The energy sector (-2.9% WTD) struggled as optimism about a potential Russia Ukraine peace deal weighed on oil prices. Defensive sectors such as consumer staples (-0.9%) and utilities (-0.6%) underperformed as tech rallied later in the week. Meanwhile, the health care sector (+0.6% WTD), also defensive in nature, closed higher following news of new agreements to lower prescription drug prices, which buoyed several major pharmaceutical names.
Economic releases this week largely reinforced the narrative of a cautious labor market and steady spending, without prompting a major shift in monetary policy expectations. November payrolls beat expectations with 64,000 new jobs, though prior-month revisions highlighted weakness, and the unemployment rate ticked higher to 4.6%. Retail sales for October were largely flat, while CPI data showed a modest slowdown in year-over year inflation. Collectively, the data confirmed ongoing moderation in inflation but did little to alter the market’s near-term Fed expectations.
Overall, the week underscored the market’s sensitivity to swings in mega-cap tech and AI-related names, while sector rotation and company-specific catalysts shaped relative performance. Despite the volatility, the major averages remained near key technical levels, setting the stage for year-end positioning and continued attention on earnings, AI developments, and data releases in the coming sessions.
• Nasdaq Composite: +0.5%
• S&P 500: +0.1%
• S&P Mid Cap 400: flat
• DJIA: -0.7%
• Russell 2000: -0.9%