Last week was a volatile week on Wall Street. 5 of the 6 Major Markets closed lower, with Emerging Markets being the lone holdout in positive territory. For the domestic markets, the Nasdaq gave back 2.1%, the S&P 500 shed 1.4%, and the Dow lost 1.2%.

As rough as the headline numbers were, looking at the S&P 500 Equal Weight Index, we can see that the Equal Weight version actually added a third of a percent last week. This highlighted how the concentration of the biggest companies in the standard S&P 500 caused an outside impact on the overall index.

Looking at the Top 10 holdings, we see that Apple was down the most with an 8% loss last week. A Number of the other holdings were not much better as Amazon and Google also both ended down more than 5 percentage points for the week.

These names pulled on the greater sectors as Communication Services and IT closed down 3.5 and 2 percent respectively. Financials closed down 4.8% as a number of big-name financial companies’ stocks dropped on news of advances in AI planning tools. These types of market drops have become more frequent of late as some new AI related headlines have caused an initial hit to developed segments of the broad market.

In economic news, a number of reports sent mixed signals. January payrolls rose by 130,000, beating expectations of around 55,000 and showing continued labor market strength. Meanwhile, CPI came in cooler than expected at 0.2%. Strong growth and moderating inflation largely offset one another, keeping rate-cut expectations in check.

Overall, the market remains bifurcated: mega-cap tech faces pressure, but defensive sectors, cyclicals, and smaller caps continue to see rotational strength.