Stock Rotation Is Back on Bets Fed Will ‘Go Big’: Markets Wrap

Wall Street traders revived prospects for a half-point Federal Reserve rate cut next week, spurring a rotation into stocks that would benefit the most from policy easing.

Economically sensitive shares outperformed the group of tech megacaps that have led the bull market, with the Russell 2000 index of smaller firms climbing 2.5%. An equal-weighted version of the S&P 500 — where the likes of Nvidia Corp. carry the same heft as Dollar Tree Inc. — beat the US equity benchmark. That gauge is less affected by the biggest companies — providing a glimpse of hope the rally will broaden out. ...