2026 Market Outlook: S&P 500 Looks Expensive, But Biotech Could Outperform Under The Hood

Core Insights - The market performance in 2025 was notably positive, but it was heavily reliant on a limited number of megacap stocks [1] - Future market performance is expected to be neutral to slightly positive, indicating a potential shift in market dynamics [1] - There is an anticipated capital rotation, suggesting a movement of investments from one sector or asset class to another [1] Summary by Categories Market Performance - 2025 saw a concentrated positive performance primarily driven by a few large-cap stocks [1] - The outlook for the market is shifting towards a more neutral to slightly positive trajectory [1] Investment Strategy - A capital rotation is expected, which may influence investment strategies moving forward [1]