Source: The Stock Traders Almanac --
With the S&P 500 Index and Nasdaq 100 Index posting their worst weeks since April, investors are now asking whether performance in roughed-up groups will continue and what stocks will do when the Federal Reserve eventually does cut rates. To see just how top-heavy the S&P 500 Index has become, consider this: since the bull market began 21 months ago, the S&P 500 has gained 54% while its equal-weight peer has added just 31%. At this point of a bull-market run during four previous cycles, the equal-weight index has outpaced the cap-weighted benchmark by 15 percentage points, on average, data compiled by Bloomberg show.
“It’s a rare feat historically to have what many people perceive as a bubble being deflated without igniting a much larger selloff,” Paulsen said. “The crucial question is whether there can be a pullback in big-tech stocks that slightly reduces their hefty concentration without having a massive rout more broadly.”