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- October 12, 202619°
- BIST10012,151-0.94%
- USD49.220.00%
- EUR55.21+0.28%
- GOLD4,192.30-0.57%
- INTEREST37.00%-1.00
- BITCOIN82,747-1.11%
- October 12, 202619°
Barclays warned against a pullback in technology stocks
Barclays recommended investors to take protection against a possible decline led by technology in the S&P 500. Although the index reached a new high, semiconductor stocks...
Barclays' trading desk recommended investors to take protection against a potential S&P 500 pullback that technology stocks could lead following the recent rise. The bank noted that index put options currently appear relatively attractive in the existing environment.
The S&P 500 reached a new high above 7,600 points this week. However, the index fell 0.4% on a weekly basis, with weakness in some major technology companies contributing to this decline.
Technology pressure pulls the index down
On Thursday, the possibility of further losses in the index also came into focus. The selling wave in Broadcom shares pressured the semiconductor sector, increasing market fragility.
Barclays stated that the bank's equity timing indicator remains in a strong sell signal zone and points to a negative balance for S&P 500 performance over the next two months. Therefore, index put options are currently considered too attractive to ignore.
The warning is based on technical outlook, not fundamentals
The bank emphasized that the cautious stance stems from the market's technical balance rather than a sudden deterioration in the fundamental outlook. In other words, the assessment is based more on current pricing and risk balance than a definite weakening forecast in future earnings potential.
According to Barclays, semiconductors now hold a 19% weight within the S&P 500. Together with technology hardware, this ratio exceeds 30% of the broad index. Therefore, a sell-off in this group could pull down many areas, including Mag7.
The bank's note also mentioned that such pressure could increase correlation and volatility in the index. In other words, the risk that technology-driven weakness would not be limited to a narrow group of stocks was highlighted.
Risk grows as semiconductor rally continues
The VanEck Semiconductor ETF rose 77% in 2026. However, the fund fell more than 3% in pre-market trading on Thursday following Broadcom's weak quarterly results and outlook.
This warning following the market's strong performance led investors to reconsider the need for risk protection alongside new highs. Barclays' message was clear: it is necessary to be prepared for a possible pullback led by technology.
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