Crisis-level swings become new normal in 2026 stock market

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Or sign-in if you have an account.Four of the eight cases of double-digit weekly gaps between the S&P 500’s best-and worst-performing groups have happened since late May. Photo by Spencer Platt/Getty ImagesForget the VIX at 18. The stock market is swinging around in ways that are beyond what’s seen as normal in bull markets.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountThe broader S&P 500 Index looks steady in recent weeks because individual moves in its constituents — however big — largely cancel each other out. Things are different on a sector level, where capital is shifting from one industry to the next at a lightning speed.So far in 2026, there have been eight cases when the weekly gap between the S&P 500’s best- and worst-performing groups reached double-digit percentages. The three other instances this century when that happened by this point in the year were in 2000, 2001 and 2009 — all ignominious periods for the market, data compiled by Sevens Report show.Canada's best source for investing news, analysis and insight.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Investor will soon be in your inbox.We encountered an issue signing you up. Please try again“Such broad weekly sector performance divergences should be viewed as a measurable market warning signal,” said Tyler Richey, with the Sevens Report Technicals. Prior instances are “all associated with periods of elevated broad market volatility, lasting market tops beginning to be established.”The turbulence beneath the placid surface of the S&P 500 is setting off alarm bells at BTIG LLC and the Sevens Report, who see the action less as a healthy rotation and more as a sign of a market due for a pullback.“I would classify a rotation as fundamentally driven — there’s a fundamental reason for people to sell one cohort of stocks and buy another — as opposed to a positioning unwind,” Jonathan Krinsky, chief market technician at BTIG LLC, said by phone. The drifting market action in recent weeks is “more of an unwind than a rotation.”United States stocks are on track to post a record number of days this year when the S&P 500 moves in one direction but a measure of its breadth — advancing stocks outnumbering declining — goes in the opposite direction, Krinsky wrote in a note last week.Four of the eight cases of double-digit weekly gaps between the S&P 500’s best-and worst-performing groups have happened since late May. The overall index hasn’t done much since then, as investors assessed conflicting headlines about the war in Iran, the future of the AI trade and the latest quarterly announcements.The next few days may bring another stretch of sharp inter-sector swings, as traders brace for Fed Chair Kevin Warsh’s second rate decision on Wednesday as well as the busiest week of second-quarter earnings reports. Mega-cap tech names including Microsoft Corp., Meta Platforms Inc. and Apple Inc. all report between Wednesday and Thursday.In fact, a gauge of dispersion within U.S. stocks in the next 30 days tracked by Cboe Global Markets Inc. hit a fresh an all-time high earlier in July, eclipsing a record set in April 2025 during the fallout from U.S. President Donald Trump’s sweeping, global tariff rollout.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.To Richey, the turbulence is a symptom of a market “that is questioning the core narrative driving the last three-and-a-half years of equity gains.”To be sure, others on Wall Street continue to see the market setup as a rotation. JPMorgan Chase & Co.’s trading desk encouraged traders to go long a momentum factor “on a more accommodating macro environment” and added that the recent selloff appears to be a “rotation more than de-risking.”To Krinsky, the setup when stock correlations hover near record lows while the overall market is sitting near record highs is becoming somewhat of a concern. A gauge of expected three-month correlations between stocks sat at 0.08 earlier this month, an all-time low.“When correlations get that low, there’s only one way for them to move,” he said. In this case, he said he’s concerned that correlations will rise because stocks fall broadly.We apologize, but this video has failed to load.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.