The great value rotation may be over as investors reembrace tech

Traders working at the New York Stock Exchange (NYSE), on May 19, 2021.


Is the great value rotation over? 

The S&P 500 is at a historic high, but investors who earlier this year overweighted their portfolios into reopening stocks like Caterpillar and banks, and away from tech and other growth stocks, appear to be rethinking that strategy.

Many of the companies associated with the “reopening” trade topped out in April or early May:

Now, a final leg of the so-called “value” trade is also cracking this week: banks.

Investors instead have begun rotating back into old-school growth stocks. 

Thursday saw new highs in Cisco, Alphabet and IBM. But perhaps more importantly, formerly deeply out-of-favor speculative growth stocks, many of them associated with Cathie Wood’s ARK funds, have begun to rebound.

The changing market narrative

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