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We just saw both the Nasdaq and S&P 500 close at their highest weekly level in history. From a purely technical standpoint, this would imply that another leg higher in stocks is in the works.

But all year, we’ve heard stories about bad market breadth, negative market sentiment, tariff tantrums, a clueless Fed, and more.

Yet our reliance on sector leadership telling the real story about what’s happening in stocks has kept us in the loop.

And this week, I’m very excited to share this latest and greatest bullish development… 

The Rising Tide Lifts All Boats

Another week has passed and we have a couple key updates on the sector leaderboard. Technology has emerged as the one-week leader, which sends a strong signal that stocks have entered breakout mode.

We’ve also seen communications emerge as the leader again on the 30-day and year-to-date basis, which is hardly a bearish signal. Between comms and tech - the market is sending a very clear message - growth is being favored.

But the even better story is tech on a global basis, and specifically, with China. 

The prospects for U.S. growth stocks are looking good here in the coming weeks, but if you’re like me and in constant search of outperformance, then I think your time will be best-spent looking abroad.

I started allocating to Chinese stocks at the start of this year, and most recently, made it an even bigger part of my plans for the next couple quarters. I suspect we’ll be hearing more and more about this story in the near-future.

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