Shifting gears: New market leadership 

The MAG7 led this bull-market for 2 years and since autumn 2024, the majority of these tech giants have taken a breather. As the spotlight has dimmed on these mega-cap stocks, we’ve witnessed a shift in market leadership towards the earlier-stage, high-growth companies.

While the majority of the MAG7 appear to be late in their "Stage 2" uptrends— many of the younger, earlier stage growth stocks are still consolidating in their "Stage 1" bases or they are early in their "Stage 2" uptrend. These earlier-stage companies are showing strong potential for substantial outperformance in the months ahead.

On top of this, recent CPI and PPI prints have come in softer than expected and with Trump about to be sworn in, there’s also the potential for a boost in investor sentiment, as he is viewed as a pro-growth/pro-America President.

The broader US economy, meanwhile, continues to hold steady and this is positive for US stocks. Historical data shows that "slow easing" cycles—where interest rates are gradually lowered or held steady—have been very good for US stocks. This is exactly the environment we’re in right now, providing a favourable backdrop for risk-on assets, including growth stocks.  https://t.co/YKr5pL7G2c