The market continued to climb with the S&P 500 and Dow Jones setting multiple record highs throughout the week. Early-week strength was driven by a sharp rotation into cyclical and economically sensitive areas, while mega-cap leadership reasserted itself by week’s end. The Dow Jones (+2.3%) led the large cap indices, driven by outsized gains in financials, industrials, and energy names, while the Nasdaq Composite (+1.9%) and S&P 500 (+1.6%) also advanced meaningfully. Smaller-cap stocks stood out, with the Russell 2000 (+4.6%) and S&P Mid Cap 400 (+3.3%) extending their early-year leadership as investors leaned into domestic growth exposure.
Sector performance reflected a clear pro-cyclical bias. The Consumer discretionary (+5.8%) and materials (+4.8%) sectors captured the widest gains, supported by strength in homebuilders, retailers, and metals-related names. The industrials sector (+2.5%) advanced amid renewed optimism around infrastructure and defense spending, while the energy sector (+2.1%) benefitted from volatility tied to developments in Venezuela and shifting expectations around global oil supply. In contrast, the utilities sector (-1.6%) finished as the lone declining sector, pressured by rising risk appetite.
Within technology, performance was more nuanced. The technology sector finished flat, masking pronounced internal dispersion. Semiconductor stocks were a notable bright spot, as the PHLX Semiconductor ETF (+3.7%) significantly outperformed on renewed enthusiasm around the AI buildout, particularly in memory and chip manufacturing names. That strength contrasted with more uneven performance among mega-cap growth stocks, leaving the Vanguard Mega Cap Growth ETF (+0.9%) trailing the broader market despite late-week support from select leaders.