00:00 Speaker A
The Nasdaq is down more than 6% this month. The S&P down 3%. The Dow is up 1.7%. and our Jared Blickley wrote an interesting piece where he said like, if risk off was the vibe here, what if that was it, people just wanted to get out, you wouldn’t see small caps doing well for example, or mid caps which are doing well. The S&P equal weight is outperforming the S&P market weight. And so this is not, as he points out, you know, a lot of the selling has been in the Mag 7, right? It’s been in some of these more speculative tech areas. It hasn’t been in people have not just been fleeing for the exits in everything, which I think is interesting, and especially not in small caps, which tend to be a more risk-on kind of trade.
00:54 Speaker B
Well, there are needs for share growth that we’ve been witnessing which is what what 20 22%? But for the smaller stocks, it’s what around 9%. So, so you put it into perspective. I mean, it’s it’s everybody loves the big names and the big money. But what what’s the quote and I’ll I’ll butcher this, but how do you get rich? I took my profits too soon. So maybe what we’re seeing with the the um with the big stocks with the mag with the large caps is people are taking their profits but maybe they’re investing those profits in I because Jared’s article talks about the the overperformance right now of mid and small cap.
01:42 Speaker A
Yeah. Yeah. So maybe there’s just a rotation at least for now that’s going on.
01:48 Speaker C
Yeah, I I uh would caution people about like, I do think most of the trade is AI. I think most of the stuff that’s doing well is AI. So I think that even on the Yeah, small and and midcap. Like you look into, you know, a few weeks ago I looked into, Oh, what are the best performing stocks this year in the Russell? Literally all electronic companies that are supplying, you know, electricity, the power names and something like Powe Industries, which I first came on my radar a few years ago because I thought of J. Powe. Um so, uh,
02:30 Speaker A
That’s not his company.
02:31 Speaker C
Yeah, no, it’s unfortunately not. Yeah, I I wonder what are the best sectors this year.
02:37 Speaker A
So okay, so you so so Jared looked at this and it’s not all AI. That’s what’s interesting. So, airlines have gotten a boost as oil has come down, right? And by the way, airline fairs have not been coming down, so they might hold on to some of that that margin. Um homebuilders have been performing well and again, in the in the 10:00 a.m. hour, I’m going to talk more about them related to the housing bill that is maybe set to go into law. Biotech and healthcare. Now, traditional healthcare tends to be more defensive, so you get that. But biotech, the IBB, which is the ETF that tracks biotech, has been flying and that does tend to be a traditionally a risk-on area.
