Information Technology broke down relative to the S&P 500 as we expected, but the weakness didn’t accelerate. The sector is still battling with resistance from two decades ago, and, barring a short-term trade, there’s really no reason to be overweight the group until we’re above those 2000 highs. The question is, should we be neutral or underweight? Based on what we’re seeing in other growth areas of the index, we still think the higher probability is further declines for this ratio. We’ll have more conviction if we see those April 2021 lows broken.
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