Axios gets you smarter faster with news & information that matters
About
Subscribe
This year' s stock market the short version
, author of Data: FactSet; Chart: Axios VisualsThe interest rate surge hammered tech stocks this year, while an energy shortage — inflamed by the war in Ukraine — turned oil and gas shares into massive winners. Driving the news: The first week of November was a microcosm of the markets this year, with tech stocks suffering mightily and energy powering ahead. Last week, the S&P 500 energy sector was the best-performing part of the blue-chip index, climbing 2.4%. (It's the only positive part of the index this year.) Tech shares — using the Nasdaq composite as a gauge — were down 5.7% last week. Tech-heavy sectors of the S&P 500, like the communications services sector — home to Alphabet and Meta — tumbled 7.4% during the week. The big picture: Some are framing the divergence in market performance as something of an economic changing of the guard. A recent report by Goldman Sachs commodities analysts — who've distinguished themselves with some savvy calls on oil prices earlier this year — entitled "The Old Economy Takes its Revenge," spotlighted recent earnings reports from Exxon and Microsoft, in which the oil giant's cash flows overtook Microsoft's. They wrote, "In our view, these results are a pivotal moment for the broader economy as high commodity prices cannibalize earnings from other sectors as well as force interest rates higher, lowering valuations." The kicker: "This past week has shown us how the Old Economy is starting to take its revenge on the New Economy," they wrote. Yes, but: While that could be the case ... plenty of "old economy" sectors like airlines, automobiles, chemicals, metals and mining stocks all remain deep in negative territory this year. Automobiles and auto part stocks are actually doing worse than tech, down roughly 40%, according to the S&P 500 subindex that follows the industry. The bottom line: The performance of the markets this year is a more straightforward story of energy stocks simply beating everything else.