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Weekly Market Recap – February 3, 2025

With 32% in the Magnificent 7 and another 19% in the rest of the technology sector, the S&P 500 is becoming a concentrated bet. Monday was a painful wakeup call when the release of DeepSeek’s new LLM sent semiconductors and tech tumbling 7.8% and 5.6%, respectively. Even though 70% of constituents ended the day up, the S&P 500 followed tech down 1.5%. While we don’t think the AI investment thesis has fundamentally changed, increased caution is warranted.

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