Morningstar recently released four charts that provide insight into the current rotation out of tech and growth stocks. The first chart shows that value stocks have outperformed growth stocks in recent months. This shift is primarily driven by rising inflation expectations and interest rates.
The second chart highlights the underperformance of the technology sector compared to other sectors like energy and financials. Tech stocks have been particularly affected by concerns over regulation and antitrust issues.
The third chart illustrates how small-cap stocks have outperformed large-cap stocks, which is another indicator of the rotation out of tech and growth stocks. Small-cap stocks are generally less exposed to the technology sector and have benefited from the reopening of the economy.
Lastly, the fourth chart shows that international stocks have outperformed U.S. stocks, further emphasizing the global rotation away from tech and growth stocks. This trend is driven by improving economic conditions in Europe and Asia.
Overall, these charts provide valuable insights into the current market dynamics and the ongoing rotation out of tech and growth stocks. Investors should carefully consider these trends when making investment decisions in the current market environment.