What if the S&P 500 fumbles its bear-market exit? What strategists think of the role of tech in this rally.

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Gains for megacap technology stocks fizzle Monday, after earlier helping put the S&P 500 on pace to exit its longest bear-market run since 1948.

The bullish momentum on megacap technology stocks, which recently drove the S&P 500 to its highest level in nearly ten months and put it on the verge of exiting its longest bear-market run since 1948, appeared to fizzle a bit on Monday.

The S&P 500 SPX dropped 8.58 points, or 0.2%, to end at 4,273.79 on Monday, after jumping as high as 4,299 in the morning trading. While the recent upside swing may have the potential to continue in the near term, some market analysts remain skeptical of the big-picture sustainability of the latest stock-market rally, as robust gains have occurred only in a small group of biggest tech names.

The market-capitalization weighted S&P 500 SPX , which has risen 11.3% year to date, is beating its equal-weighted counterpart SP500EW , which is up 1.5% this year, by nearly 10 percentage points in 2023. That’s the biggest margin of outperformance year to date on record, according to Dow Jones Market Data.

However, Stephen Hoedt, managing director of equity and fixed income research at Key Private Bank, said focusing on the negative is probably the wrong message for investors, since he expects overall performance to improve, rather than continuing to see less than 10 individual stocks driving gains for the S&P 500.

 

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Dow ends 200 points lower as stocks drop Monday after back-to-back gainsU.S. stocks closed lower on Monday, failing to extend robust gains from last week, as tech stocks pull back from 2023 highs. The Dow Jones Industrial Average fell about 200 points on Monday, or 0.6%, ending near 33,562:
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