📈 Financials Lead
No sector is performing better.
Financials Lead the Way
If you were to guess what some of the top performing sectors from 2024-2025 was, what would you say? Likely tech, semiconductors, cloud names.
In reality, all of these sectors were outperformed by Financials (XLF) and Capital Market names (KCE).
This is a trend that was established last year, but is likely to continue into the future as a result of the Trump administration’s deregulation of the financial sector.
Don’t sleep on these names in favor of only trading tech, because clearly these sectors have the ability to provide greater returns.
Post-DeepSeek Sectors
It’s also worthwhile to look at which sectors are outperforming since the news that hit over the weekend about DeepSeek that brought the market down.
You can see that in addition to Financials, institutions are rotating into cloud names.
This is occurring because what DeepSeek exposed was that fewer semiconductors will be needed than previously expected (which is bad for semiconductor names, thus the SOXX selling down).
On the other hand, it also signaled that companies building AI capabilities (like cloud names that are investing heavily in AI customer service agents etc.) is much less costly than we thought.
This is why we are seeing semiconductors continue to lag behind cloud names.
Drilling down and understanding who stands to gain from breaking news stories (like DeepSeek) is crucial to succeeding in trading the market.
For more info on this, watch the video below: