Tech Sector Going Nowhere ... or Worse?

Remember back in high school gym class, when one of the warmup exercises was “jogging in place?” That’s what the technology sector of the S&P 500 has done over the past 3 months. After a nice recovery from a brief 5% dip, XLK is flat for that period.

That would usually mean that the rest of the stock market is following the leader (tech). But in recent weeks, there’s yet another hint of a year-2000-style shift, where sectors like utilities, REITs and consumer staples suddenly break out, while tech does what it has rarely done the past several years…lag behind.

SPXT is a small ETF, but very valuable in my work, since it is the S&P 500 minus that one sector, tech, still cap-weighted like the traditional SPY ETFs, but excluding that largest and most popular of the 11 sectors.

Again, this might just be a ruse, but as I’ve seen in my YARP stock portfolio I’ve been building and writing about, those ignored, smaller sectors of the market may be starting to go in one direction, while the market starts to find reasons to run from tech. I didn’t have that on my proverbial “bingo” card, but have always been looking for it, since I remember the year 2000 like it was yesterday. And I’m determined to crush it if the market comes to resemble what happened to investors that year, and the 2 years after that.

Related: QQQ Symptomatic of an Unhurried, Undecided Stock Market