Energy and software stocks outperform while semiconductors and Emerging Markets lag amid oil price swings and AI capex uncertainty.
Global equity indices remained largely flat over the summer, but significant sector rotations reshaped performance. Higher oil prices boosted energy stocks, while within technology, software outperformed semiconductors due to investor focus on long-term AI capital expenditure risks rather than earnings disappointments.
Emerging Markets underperformed, contrasting with Norway, Europe, and Sweden, which benefited from energy exposure and geopolitical resilience. South Korea was a notable laggard, with equities down around 6%, while US and European markets showed relative strength.
Sentiment improved recently as lower oil prices supported risk appetite, though sector divergences persisted. The rotations highlight shifting investor priorities amid macroeconomic and geopolitical uncertainties.