Weekly S&P500 ChartStorm - 15 February 2026
This week: tech wreck check, software stocks, capex vs buybacks, private equity stocks, defensives strategy, energy sector setup...
Welcome to the latest Weekly S&P500 #ChartStorm!
Learnings and conclusions from this week’s charts:
Tech stocks (particularly software) remain under pressure.
Investor exposure to tech is at historically elevated levels.
Surging tech capex is coming at the cost of buybacks.
Private equity stocks are also coming under pressure.
Defensive stocks meanwhile are looking up.
Overall, it’s fair to say that we are at a challenging juncture in markets. Tech stocks are coming under pressure, and from a starting point of major overvaluation and historically high allocations. So it’s worth keeping a closer eye on risk management and potential upside in defensives, while staying pragmatic with the otherwise still bullish outlook for cyclicals/global/commodities…
1. Going it alone? as outlined the other day, the US tech sector remains under pressure, and the path of the Nasdaq 100 is presenting a very different picture than that of the equal-weighted S&P500. So far it has been a case of rotation, with bullish rotation into cyclicals carrying the market for now.
But there is a risk that further downside in tech de-rails the bullish rotations and activates more of a defensive/bearish rotation or just plain and simple: downside for stocks in general.
Source: MarketCharts
2. Hard Times for Software: the epicenter of the tech troubles so far has been software (as AI threatens to topple software IP moats), and we have seen software making major relative declines vs the rest of tech and vs the rest of the market (+major absolute declines e.g. with IGV down more than 30%).
It’s likely that this is somewhat overdone short-term (as the market shoots first asks questions later), but the risk is that it damages investor sentiment and triggers off further waves of weakness in overextended tech stocks (high starting point valuations and allocations).
