We expect the “rotational correction” in stocks to continue

Stocks fell for a third straight week for the first time in nearly a year. Mega-cap technology stocks again fell notably, with several high-profile names dropping close to 5%. We appear to be beginning an unwinding of a trend that dominated much of 2020, when these same stocks drove markets to new highs. The cap-weighted S&P 500 Index has significantly outperformed the equal-weighted index this year, and we think the latter more accurately reflects an uneven recovery and several downside risks.