The outperformance of value stocks that occurred on September 9th is “unnerving to investors because a rotation away from growth could “result in a downturn for the broader market, some fear.” This according to an article in CNBC.
Growth stocks, the article notes, “have blown their value counterparts out of the water over the past five years,” and outperformed the S&P 500 over the same period.
The article reports that some investors see the sudden shift as a warning signal that trouble is brewing underneath the market surface. In a recent note, JP Morgan executive director Adam Crisafulli wrote: “The rotation, despite it being a positive signal in terms of investor macro sentiment, is probably a net negative for the overall SPX in that super-cap tech will likely be caught up in the selling and these stocks dominate the index weighting.”