The Market Didn't Get Killed Today. Tech Did.

The headlines this weekend will tell you the market got slaughtered. Look closer before you believe them.

Yes, the Nasdaq took a 4-plus percent hit, its worst day in over a year, and the semiconductors finally flinched after leading this whole rally. But here is the part the panic misses. 

The chips only fell to the lower edge of their expected move. They closed almost exactly where they sat two weeks ago. The epitome of this rally barely scraped its knee.

And while tech bled, look at what everyone else did. Money did not run for the exits. 

It rotated. 

Consumer staples actually finished up around 2% on the day, with Coca-Cola and Procter and Gamble both higher. 

Healthcare caught a bid, with Eli Lilly up near 3%. Utilities and defensive names held. That is not what a market getting killed looks like. 

That is money moving from one side of the room to the other.

Here is how I know the difference. 

When a market truly breaks, you see correlation, everything selling at once. We did not get that today. We got a hit that was almost entirely isolated to tech, with half the market holding its ground or climbing right through the selling.

So when you hear "bloodbath" this weekend, remember what actually happened. One crowded corner of the market took a breather and gave back two weeks of gains. 

Everything else was fine. That is a very different picture than the one you are about to be sold.

To your success, 

Don Kaufman