XLK ETF

Designed to provide broad exposure to the Technology - Broad segment of the equity market, the Technology Select Sector SPDR ETF (XLK) is a passively managed exchange traded fund launched on 12/16/1998.

In the latest edition of Yahoo Finance's Chartbook, senior markets reporter Josh Schafer discusses how Wall Street views the ongoing dominance of Big Tech in the market. Analysts have noted that while Big Tech has thrived during this bull market, Nvidia's recent loss of nearly $600 billion in market cap raises concerns about an overreliance on technology stocks. Additionally, major companies like Meta Platforms, Tesla, and Microsoft are set to announce their fourth quarter earnings soon, with Apple following shortly after.

Anthony Pompliano, the founder and CEO of Professional Capital Management, shares his views on the AI industry after the rise of the Chinese startup DeepSeek. He believes that many mainstream investors do not fully understand AI, which leads to fear and selling when they encounter something new. However, he sees DeepSeek's success as a positive sign for both the AI sector and the wider cryptocurrency market.

The recent sell-off in tech stocks due to DeepSeek's new AI model has generated significant interest on Wall Street as earnings week approaches. Art Hogan, chief market strategist at B. Riley Wealth, highlights that while the tech sector is under pressure, earnings reports indicate positive growth in other areas. He advises a cautious approach to AI stocks and suggests focusing on undervalued sectors like energy, financials, and healthcare, which he believes are set for growth despite their recent struggles.

As the market reacts to DeepSeek's new AI model on Monday, investors need to think about how to adjust their portfolios to avoid being too reliant on Big Tech and AI investments. Kenny Polcari, chief market strategist at Slatestone Wealth, shares his views on the current market situation before the upcoming Big Tech earnings. He expresses skepticism about the effectiveness of the new AI model, questioning how a startup from China could outperform American efforts with lower-quality technology.

The Dow Jones Industrial Average (^DJI) managed to gain more than 0.6% today, while the Nasdaq Composite (^IXIC) and S&P 500 (^GSPC) dropped over 3% and nearly 1.5%, respectively. Concerns about competition from the Chinese startup DeepSeek led to a sell-off in the market. For more expert analysis on today's market trends, you can watch Market Domination Overtime with Julie Hyman and Jared Blikre.

DeepSeek, a Chinese AI startup established in 2023, is attracting attention after launching its open-source R1 model on January 20th, which competes with OpenAI's o1 model. Julie Hyman from Market Domination discusses the chatbot's appeal, noting its cost-effective development that doesn't rely on Nvidia's advanced chips, which may help it avoid export restrictions. Despite facing some challenges like biased responses, DeepSeek has quickly risen in popularity, affecting major market indexes.

The tech sector has produced many stocks that have outperformed the S&P 500.

US stocks (^GSPC, ^IXIC, ^DJI) have risen after December's Producer Price Index (PPI) showed lower-than-expected inflation. Scott Ladner, Chief Investment Officer at Horizon Investments, explains that the recent increase in interest rates is mainly due to economic growth rather than inflation concerns. He also advises investors to consider international stocks and highlights technology and financial sectors as strong areas, especially with the upcoming earnings reports from major banks.