The current market rotation, reminiscent of the late 1990s, is still unfolding, with the iShares Expanded Tech-Software Sector ETF down over 20% as industrials and consumer staples thrive. The S&P 500 Equal Weight index’s outperformance indicates a broadening leadership, suggesting we may be in the middle stages of this rotation. Amid this shift, tech-adjacent and telecom infrastructure stocks present compelling opportunities, particularly smaller firms like Clearfield and Belden.
Clearfield (CLFD) is capitalizing on the Broadband Equity, Access, and Deployment (BEAD) program, which is set to accelerate demand growth in fiber infrastructure. The company reported a 16% year-over-year sales increase in Q1 2026 and is well-positioned to benefit from government funding, despite some execution risks. Meanwhile, Belden (BDC) is transitioning towards higher-margin industrial IoT solutions, with a strong growth trajectory in its segments tied to essential networking infrastructure.
As the “Great Rotation” continues, investors should consider these under-the-radar stocks in sectors poised for real-economy growth, while remaining cautious of potential volatility during the transition.
Source: fool.com