Market Rally Defies Rotation Narrative as Tech Rebounds

U.S. equities staged a decisive recovery on Friday, erasing weekly losses with the Dow Jones Industrial Average surging 1.53% to a record close. The S&P 500 eked out a 0.27% weekly gain despite earlier volatility, while the Nasdaq-100 remained down 0.90% after a five-day selloff in AI-related stocks.

Market observers had speculated about a sector rotation toward defensive names trading at sustainable multiples—a theory undermined by the absence of traditional bear-market signals. Consumer staples failed to outperform during the downturn, and the VIX volatility index lingered NEAR historic lows. Goldman Sachs capitalized on the dislocation, recommending momentum-stock dip-buying ahead of Friday's rally.

The rebound confirmed bullish convictions as capital flooded back into growth assets. This price action suggests speculative appetite remains intact, with investors treating the pullback as a buying opportunity rather than a regime change.