The S & P 500 may shut at an historic excessive at this time. What modified? It was a fairly gloomy begin to the 12 months, however that has evaporated. On January 4th, three days into the brand new 12 months, the S & P 500 closed at 4,688, down 1.7% for the very younger new 12 months. The Santa Claus Rally had failed. Now one other indicator, the First 5 Days indicator, was about to fail too. Apple, Microsoft, and Nvidia have been all decrease. And by the beginning of the subsequent week, all of it started to reverse. The First 5 Days indicator went constructive. Everybody was hunkered down for a backyard selection correction of a 5%-10% decline. Not even that occurred. January 4th was the low. Immediately, the S & P 500 is constructive for the 12 months, by lower than 1% however nonetheless constructive, and we’re knocking on the door of the outdated closing excessive of 4,796 relationship from January 3, 2022. What turned issues round was an old school tech rally, the precise factor that everybody was prepared to jot down off as a result of, effectively, after being the Large Story of 2023, a big-cap tech rally could not occur once more, proper? Improper. Apart from a slight lag from Apple, it’s expertise and communication providers shares on the leaderboard once more. Large cap tech (YTD) Apple – 1.8% Alphabet + 4.0% Amazon + 1.2% Nvidia + 16.1% Meta + 7.0% Microsoft + 5.1% The remainder of the market isn’t cooperating. Outdoors of tech, solely defensive names that had lagged final 12 months like well being care are constructive. S & P Sectors YTD Well being Care + 1.9% Shopper Staples – 0.2% Vitality – 4.5% Actual Property – 4.3% Banks – 3.5% Shopper Discretionary – 2.3% What is the lesson? Tech bull Dan Ives at Wedbush was directionally proper all final 12 months. He could not assist however take a shot on the bears: “With 2024 kicking off and the bears in typical fashion yelling fire in a crowded theater to start the year on valuation and ‘recession’ worries, now all Street eyes are on 4Q earnings season and initial 2024 guidance for the tech sector to gauge underlying enterprise and consumer demand,” he wrote in a observe to purchasers this week. “We believe the key narrative for 4Q earnings season is the beginning of the AI Revolution hitting the shores of the broader tech landscape being led by Nadella and Microsoft along with the Godfather of AI Jensen and Nvidia,” Ives wrote, referring to the 2 firms’ respective CEOs.