Soft US CPI reinforces rotation trade, as tech unease looms

Show notes

US inflation delivered some relief last Friday, but falling yields couldn’t cheer up Big Tech stocks. Investors remain uneasy about elevated valuations and the scale — and leverage — of AI spending. Markets are caught between two fears: that AI returns will disappoint, or that AI disruption will go too far, too fast.
While the S&P 500 held flat, the equal-weighted index outperformed, signalling the rotation trade is alive and well. The Magnificent 7 extended losses, showing that Big Tech remains under pressure despite dovish Fed expectations.
This week will be quieter, with US markets closed and China on Lunar New Year holiday. Still, key data to watch include the Fed minutes, US PCE update and flash PMIs, along with Walmart earnings — all offering clues on consumer resilience and whether the rotation away from mega-cap tech has more room to run.

Listen to find out more!

Ipek Ozkardeskaya has begun her financial career in 2010 in the structured products desk of the Swiss Banque Cantonale Vaudoise. She worked at HSBC Private Bank in Geneva in relation to high and ultra-high net worth clients. In 2012, she started as FX Strategist at Swissquote Bank. She worked as a Senior Market Analyst in London Capital Group in London and in Shanghai. She returned to Swissquote Bank as Senior Analyst in 2020, and launched her own website ipekScope.com in 2025.