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Tech Tumble: Why Value is Winning Now · The SPY Trader

• 0:00
  Welcome back to Spy Trader , the only podcast that makes sense of your weekly portfolio chaos .
• 0:06
  I'm your host , Skip Ticker , and it's 5 am on Saturday , December 13th , 2025 , Pacific .
• 0:14
  We just wrapped up one of the most turbulent but telling weeks we've seen all year , characterized by a massive rotation out of highflying technology and into classic value stocks .
• 0:25
  Let's dive into what happened and where we should be positioning ourselves for the coming week .
• 0:30
  The biggest takeaway this week is the sharp divergence across the major indices .
• 0:35
  The S&P 500 managed to gain about 0.5% for the week , but Friday was tough , seeing its worst day in three weeks , falling 1.1% .
• 0:47
  The Nasdaq Composite was the clear loser , dragged down by tech earnings , dropping a massive 1.7% just on Friday .
• 0:57
  The Dow Jones Industrial Average , however , was the champion , set to gain around 1.6% for the week , highlighting the sudden strength of industrial and cyclical names .
• 1:08
  This rotation started earlier in the week when the Federal Reserve cut its benchmark rate by a quarter point to the 3.5%3.75% range .
• 1:17
  This anticipated easing cycle pushed the S&P and Dow to record highs midweek , but the tech sector just couldn't sustain the momentum .
• 1:27
  This wasn't just profittaking ; it was a fundamental shift .
• 1:31
  We saw capital flee Technology , which was down 2.18% for the week , and rush into sectors like Basic Materials , which soared 3.06% , and Financial Services , which was up 2.38% .
• 1:46
  This means investors are suddenly favoring cyclical stocks like Goldman Sachs and JPMorgan Chase that benefit from an easing Fed and a solid economic outlook .
• 1:57
  The big triggers for the tech collapse came from disappointing forecasts .
• 2:01
  Broadcom , ticker AVGO , plunged 11.4% on Friday after concerns over margin pressure , despite beating earnings .
• 2:10
  Oracle , ORCL , suffered a similar fate , falling nearly 11% earlier in the week due to disclosing a huge , 15 billion higherthanprojected increase in capital expenditures for AI infrastructure , raising doubts about nearterm profitability .
• 2:29
  Even the AI darling , Nvidia , fell 3.3% in sympathy on Friday .
• 2:34
  Adding pressure , the 10year Treasury note yield climbed back up near 4.19% , making those longduration growth stock valuations look even pricier .
• 2:45
  So , where do we go from here ?
• 2:47
  The market is undergoing a necessary correction , but the economic backdrop remains firm due to the Fed’s easing .
• 2:54
  Our strategy should reflect this rotation .
• 2:57
  First , capitalize on the Value trade : Consider increasing exposure to Financial Select Sector SPDR Fund , or XLF .
• 3:06
  Financials are primary beneficiaries of this rotation and the stability offered by the Fed's stance .
• 3:12
  Second , for those looking to selectively enter Tech after the drop , use a diversified approach like the Invesco QQQ Trust .
• 3:21
  The broad selloff might offer a more attractive entry point if you believe the longterm AI thesis holds , but diversification is key right now .
• 3:30
  Third , don't ignore stability .
• 3:32
  The Fed's three rate cuts this year support bonds , so maintaining holdings in something like the Vanguard Total Bond Market ETF , BND , provides necessary ballast against equity volatility .
• 3:45
  Finally , remember that strong fundamentals still matter : Look at Lululemon Athletica , LULU , which jumped nearly 10% on Friday after beating profit and revenue expectations .
• 3:58
  Be cautious of overconcentration in volatile single AI names like Broadcom and Oracle until we get more clarity on those capital expenditure concerns .
• 4:09
  That’s all the time we have for this edition of Spy Trader .
• 4:13
  Stay safe out there , and we'll catch you next time !