The stock market often leaves clues when leadership starts to shift. In last Friday’s Market on Close segment, John Rowland, CMT, took us through the five-day sector heatmap — and the message was clear: profit-taking is underway in mega-cap tech while money rotates into other areas of the market.
Tech Weakness at the Top
Despite a rally into the end of the week, technology (XLK) was the worst-performing sector over the last five sessions. Names like NVIDIA (NVDA), Microsoft (MSFT), Apple (AAPL), Broadcom (AVGO), Palantir (PLTR), and Advanced Micro Devices (AMD) all finished lower — a sign that investors may finally be taking profits after an extended run in high-beta growth leaders.
This isn’t necessarily bearish for the entire market. Instead, it’s a reminder that concentration risk in tech can unwind quickly, and active traders should look for where capital is moving next.
Rotation Into Financials, Industrials, and Energy
Financials were among the week’s stronger performers. As John noted, the sector’s breadth stood out:
- Berkshire Hathaway (BRK.A) (BRK.B), long a bellwether for market breadth, posted gains.
- Visa (V), Mastercard (MA), JPMorgan Chase (JPM), and Bank of America (BAC) also showed strength.
- Even asset managers like BlackRock (BLK) contributed to leadership.
Industrials and energy also found buyers, suggesting a broadening market that leans on cyclical and value-heavy groups when tech takes a breather.
The Telling Signal: Utilities
But perhaps the most interesting takeaway came from utilities.
Recent high-flyers like Constellation Energy (CEG) and Vistra (VST) — both tied to the data center and AI energy supply narrative — pulled back about 3% on the week. But “old school” utilities like Southern (SO), Duke (DUK), and Dominion (D) finished stronger.
Why does this matter?
Because Fed Chair Jerome Powell recently hinted at a move toward a lower interest rate environment. Utilities, which are capital-intensive and sensitive to financing costs, tend to benefit disproportionately when borrowing costs decline. That could position them as a quiet outperformer if rates ease.
How to Track the Rotation with Barchart
Here are three simple steps you can use to keep up with sector shifts:
- Sector Performance Pages: View real-time sector heatmaps and see which industries are gaining or losing momentum.
- ETF Screener: Screen for S&P 500 sector ETFs like Tech (XLK), Financials (XLF), Industrials (XLI), Energy (XLE), and Utilities (XLU). Add filters for RSI, moving average slopes, and volume trends to identify sectors poised for breakouts.
- New Recommendations: Watch for fresh buy/sell signals across sectors using Barchart’s technical models.
Bottom Line
Markets at all-time highs don’t move in a straight line. Sector rotation is healthy, and utilities may be the quiet beneficiary as rate policy shifts.
Watch the full Market on Close clip to hear John Rowland’s breakdown of sectors and why he’s watching utilities:
Then, explore sector ETFs and top holdings to build your own rotation playbook.
On the date of publication, Barchart Insights did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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