Danske Research Team reports that global equities advanced, but underlying performance was highly dispersed, with US consumer and communication services names under pressure while most S&P 500 sectors and small caps gained. Sentiment was further hit by sharp volatility in SpaceX, with futures now lower as US tech again weighs.

Sector rotation and SpaceX volatility

"Global equities rose yesterday, but the headline masked an extreme dispersion beneath the surface. The US was dragged lower by what many would instinctively call Big Tech, but the real pressure came from consumer-facing sectors and, not least, communication services, including media."

"The heavy media names did much of the damage. To put yesterday's US session in perspective, eight of the 11 S&P 500 sectors closed higher and small caps outperformed, illustrating just how sector-specific the rotation was."

"Sentiment was also hit by the sharp fall in SpaceX, where it is remarkable to see a company of that size display this degree of volatility so early in its listed life. With SpaceX soon to enter Nasdaq indices under the new fast-entry rules, this will inevitably raise questions about index inclusion mechanics."

"Looking back to Europe and the US, futures are lower, with US tech again doing most of the damage this morning."

(This article was created with the help of an Artificial Intelligence tool and reviewed by an editor.)