Semiconductors are the silicon backbone of the digital revolution. Demand for chips is variable though, meaning that corporate inventory levels and sentiment can significantly impact the industry. Uncertainty surrounding these factors has hurt semiconductor stocks over the past six months as they have pulled back by 7.5%. This drawdown is a far cry from the S&P 500’s 9% ascent.
Most consumer discretionary businesses succeed or fail based on the broader economy. Lately, it seems like demand trends have worked in their favor as the industry has returned 15.5% over the past six months, outpacing S&P 500 by 6.6 percentage points.
Even if they go mostly unnoticed, industrial businesses are the backbone of our country. Still, their generally high capital requirements expose them to the ups and downs of economic cycles, and the industry’s six-month return of 5.7% has fallen short of the S&P 500’s 9% rise.
Industrials businesses quietly power the physical things we depend on, from cars and homes to e-commerce infrastructure. Unfortunately, this role also comes with a demand profile tethered to the ebbs and flows of the broader economy, and the industry is currently lagging as its six-month return of 5.7% has trailed the S&P 500’s 9% gain.
Semiconductors are the picks and shovels of modern technology. Still, they’re subject to swings in the broader economy because customers often stockpile chips ahead of demand, and investors seem to believe that inventory levels are correcting - over the past six months, the industry has shed 7.5%. This drawdown is a stark contrast from the S&P 500’s 9% gain.
Healthcare companies are pushing the status quo by innovating in areas like drug development and digital health. Despite the rosy long-term prospects, short-term headwinds such as COVID inventory destocking have harmed the industry’s returns - over the past six months, healthcare stocks have collectively shed 1.7%. This drop is a stark contrast from the S&P 500’s 9% gain.
A ceasefire deal between Russia and Ukraine would take the sting out of heightened U.S. trade tensions and ease pressure on energy prices and the euro, markets bet, while expectations for defence spending have already sent stocks in the sector surging. President Donald Trump last week ordered U.S. officials to begin talks on ending the war and Secretary of State Marco Rubio arrived in Saudi Arabia on Monday for discussians with Russian officials. However, neither Ukraine nor European nations are expected to be present at the talks.
From commerce to culture, software is digitizing every aspect of our lives. The undeniable tailwinds fueling the industry have also led to strong returns for SaaS stocks lately as they’ve gained 30.2% over the past six months, outpacing the S&P 500’s 9% rise.
Looking back on ground transportation stocks’ Q4 earnings, we examine this quarter’s best and worst performers, including Saia (NASDAQ:SAIA) and its peers.
Crypto markets fell with XRP and SOL leading declines among major cryptocurrencies.
