Deutsche Bank strategist Parag Thatte says the rotation into tech that began in late July still has room to run. Since late July, large-cap growth and tech names are up about 14% while the rest of the S&P 500 is down roughly 3%. Their relative performance has moved into the upper half of its long-term trend channel but has not reached the top. Positioning in large-cap growth and tech is about 0.8 standard deviations above neutral — a clear overweight but well below prior peaks (early June hit th

Deutsche Bank strategist Parag Thatte says the rotation into tech that began in late July still has room to run. Since late July, large-cap growth and tech names are up about 14% while the rest of the S&P 500 is down roughly 3%. Their relative performance has moved into the upper half of its long-term trend channel but has not reached the top. Positioning in large-cap growth and tech is about 0.8 standard deviations above neutral — a clear overweight but well below prior peaks (early June hit the 99th percentile). Single-stock options activity has surged in large-cap growth and tech, followed by consumer cyclicals, industrial cyclicals and defensives; energy volumes have fallen, while materials and financials are around average. Deutsche Bank says the rotation is in a deeper phase but still has room, and reiterates that rate volatility, not the level of rates, remains the key variable for equities.