Traders
work
on
the
floor
at
the
New
York
Stock
Exchange
on
June
24,
2024.
Brendan
McDermid
|
Reuters
Stocks
retreated
Friday,
as
Wall
Street
wrapped
up
the
week
defined
by
a
rotation
out
of
this
year’s
megacap
winners
in
favor
of
smaller
names.
The
S&P
500
dropped
0.71%,
closing
at
5,505.00.
Nasdaq
Composite
slid
0.81%
to
end
at
17,726.94.
The
Dow
Jones
Industrial
Average
fell
377.49
points,
or
0.93%,
to
40,287.53.
Friday’s
moves
marked
another
day
of
declines
across
the
board,
with
the
Russell
2000
down
0.63%.
But
a
shift
toward
names
viewed
as
bigger
beneficiaries
of
interest
rate
cuts
from
the
Federal
Reserve,
like
small
caps,
still
appears
to
be
theme
of
the
week.
The
S&P
500
and
Nasdaq
slipped
1.97%
and
3.65%,
respectively,
marking
their
biggest
weekly
losses
since
April.
The
tech-heavy
Nasdaq
also
snapped
a
six-week
win
streak.
On
the
other
hand,
the
Dow
advanced
0.72%,
while
the
small
cap-focused
Russell
2000
climbed
1.68%.
“The
stock
market
is
experiencing
a
long
overdue
rotation,”
said
Glen
Smith,
chief
investment
officer
at
GDS
Wealth
Management.
“Investors
are
taking
money
out
of
big
tech
stocks
which
have
performed
so
well
and
moving
that
money
into
other
areas
of
the
market.”
That
divergence
has
encouraged
some
Wall
Street
pros,
who
had
worried
that
the
market
rally
was
becoming
too
dependent
on
a
handful
of
massive
tech
stocks.
Meanwhile,
rising
optimism
around
forthcoming
interest
rate
decreases
from
the
Fed
have
bolstered
smaller
and
more
cyclically
oriented
names.
A
shift
away
from
megacap
artificial
intelligence
beneficiaries
can
explain
the
Nasdaq’s
underperformance
this
week.
Similarly,
the
information
technology
sector
led
the
broad
S&P
500
lower
with
a
5.1%
drop.
“The
headline
is
‘these
are
down’
with
some
of
the
momentum
stocks
getting
hit,”
said
Chris
Verrone,
head
of
technical
and
macro
research
at
Strategas,
on
CNBC’s
“Squawk
Box.”
But,
“the
breadth
under
the
surface
these
last
two
weeks
has
been
absolutely
spectacular.”
CrowdStrike
tumbled
11.1%
following
a
major
information
technology
outage
that
impacted
business
around
the
world.
The
New
York
Stock
Exchange
and
Nasdaq
both
said
trading
did
not
appear
affected.
