The US stock market attempted to rebound from Monday’s losses, with the tech sector experiencing its worst day since 2020. Matt Stucky, Chief Portfolio Manager at Northwestern Mutual, emphasized the importance of diversification for investors navigating the volatile market. He said, “Yesterday’s market reaction shows the importance of diversification.”
💥 💥 💥 @sonusvarghese wrote this amazing and timely piece on DeepSeek, AI, tech stocks crashing, and what it all means. You'll definitely want to check this one out. @CarsonResearchhttps://t.co/mzVUHbkyAt
— Ryan Detrick, CMT (@RyanDetrick) January 28, 2025
“Investors should consider embracing a broader array of investments beyond just US large caps.”
Despite high-profile casualties of DeepSeek, like Broadcom and Nvidia (-11% and -4% YTD, respectively), most stocks have been doing well YTD: 375, corresponding to ~75%, of S&P 500 constituents are up this year, with >53% beating index
@SPDJIndices pic.twitter.com/rv7WXnDVNk— Liz Ann Sonders (@LizAnnSonders) January 29, 2025
#BrokerageRadar | Key stock ratings and target prices👇 #Read insights on the latest stock recommendations and target prices from top brokerages! #StockMarket #Investing #MarketUpdates pic.twitter.com/tK1vxNtHYe
— ET NOW (@ETNOWlive) January 29, 2025
Tech stocks face diversification challenges
The heavy reliance on tech stocks has made the sector particularly vulnerable to significant fluctuations, as seen in the recent sell-off.
Stucky highlighted the importance of the Federal Reserve’s upcoming Federal Open Market Committee (FOMC) meeting. The meeting, which starts today and concludes on Wednesday, could offer insights into the Fed’s focus on disinflation. If inflation trends continue to improve, the Federal Reserve might ease interest rates further, potentially spurring broader market growth.
What caused selloff in AI-dominated stocks and what does it mean for markets? Nikunj Dalmia DECODES | Editor's Take @nikunjdalmia https://t.co/PiJHlBrFpn
— ET NOW (@ETNOWlive) January 28, 2025
Please get information from your financial advisor before changing your portfolio–and stay tuned for more details.