Quote:Start with the biggest loser of the day, the Dow Jones Industrial Average (^DJI), which was down 1.81%, or 614 points, on Wednesday, its worst showing in over a month. As of late December, the Dow had outperformed the Nasdaq by 20 percentage points — the most since the dot-com bubble crash two decades prior. Despite this outperformance, however, the Dow ended 2022 down nearly 9%. There were few places for investors to hide in 2022. But Wednesday, the Nasdaq outperformed the Dow by 57 basis points. Particularly notable coming on such a negative day for the market.
In the first 11 trading days of the year, the Nasdaq is already up 4.69% compared to the Dow's meager 0.45% gain. If we dive inside the benchmark S&P 500 and look at relative sector performance, 2023's year-to-date sector chart is nearly the inverse of 2022. Last year's second-worst-performing sector is this year's best: Consumer Discretionary (XLY). Helping matters are the sector's two largest megacap components — Amazon (AMZN) and Tesla (TSLA) — which are both nicely positive so far in 2023, gaining a little over 4% each. The two other sectors besides consumer discretionary that house some of the market's biggest names — Tech (XLK) and Communication Services (XLC) — are also serving as leaders this year. The 2023 investment narrative is already diverging from 2022: Morning Brief
Quote:our call of the day from Jefferies tackles that idea. “Disinflation is a key assumption for our road map for 2023,” says Desh Peramunetilleke, global head of microstrategy, and analyst Mahesh Kedia, in a note to clients on Thursday. “The 1980s disinflation cycle brought about by higher rates and easing supply side pressures provide a good template for the current cycle. Broadly, quality growth stocks/sectors did better than value, and small-caps underperformed,” said the pair. What did well from April 1980 to February 1983 was the consumer, with business services, staples and consumer services outperforming, while commodities and industrials did less well. Buying quality and avoiding value was also a smart move, they add.The 1980s was the blueprint for the upcoming disinflation cycle and these are the stocks for it, strategists say - MarketWatch