Market Performance - The market has seen a rotation trade with materials up 4%, financials up 3%, and industrials up 1.5% over the past week, while communication services and technology sectors lagged behind [1] - Deutsche Bank reported that technology experienced its first back-to-back weekly outflows since June, indicating a shift in investor sentiment [2] Sector Rotation - There is a meaningful rotation occurring, particularly affecting technology and AI sectors, with expectations that this trend will continue into 2026 [3][4] - The performance differential between the MAG 7 (top tech stocks) and the broader market (493 stocks) has widened, suggesting potential for a return to MAG 7 stocks in the near term [3][4] Economic Outlook - The Federal Reserve has increased its expectations for economic growth next year, which is expected to support a "run it hot" trade, anticipating a rebound in manufacturing, construction, and consumer spending [6][7] - Liquidity infusion expected around tax time in April and May is also seen as a supportive factor for market performance [7] Consumer Sector Insights - Consumer discretionary stocks are showing strength, with some reaching new highs, driven by a resilient consumer base despite economic concerns [9][10] - The market is witnessing a shift as investors look for opportunities outside of technology, with consumer discretionary stocks gaining attention [11][12] Stock Specific Movements - Tesla's significant stock movement, particularly its testing of driverless robo taxis, has influenced the consumer discretionary sector positively [15][16] - Financials have reached record highs, attributed to the steepening yield curve and overall economic conditions [20] Defensive Sectors - Healthcare has emerged as a leading sector, appealing to investors seeking lower beta and defensive positions amid valuation concerns [22][23]