Technology stocks’ rally halted and ran into resistance a few weeks ago. The US inflation data from last week revealed a mixed picture, indicating that higher rates could linger around for the foreseeable future. We are now witnessing a tech correction both in absolute and relative terms. The ratio of Equal-Weight Technology to Equal-Weight S&P500 (RSPT/RSP) failed to break above a crucial level of 0.2. We believe that if the ratio remains in the 0.2 range, it could result in continued underperformance of the technology sector.
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