# Investors Appear to Shift Toward Defensive Stocks as Tech Weakens By Enna Lee Canonical URL: https://www.tokenpost.com/news/investing/54685 Published: 2026-11-12T00:18:14.000Z Updated: 2026-11-12T00:18:14.000Z Section: Investing > The Nasdaq Composite remains down 0.7% for November after an October decline, while defensive-sector indexes have risen over the past month. Investors in U.S. stocks appear to be favoring health care, consumer staples and utilities as technology volatility tied to artificial intelligence (AI) spending and the economic outlook pressures major indexes. The Nasdaq Composite kept an 8.7% gain for the year through its Nov. 9 close. It shed 5.3% in October and, after briefly entering correction territory last week, recovered part of the decline in recent sessions. The index remained down 0.7% for November. That weakness is not limited to the Nasdaq. MSCI’s U.S.-only IT index has fallen 11.5% since October. The MSCI World Information Technology index lost 7% in October and another 4.6% so far this month. South Korea’s Kospi, which is heavily exposed to semiconductors, slid 16.2% in October and is down more than 8% for November. Technology stocks have faced several rounds of volatility this year as investors weighed AI capital spending, cash flow, debt and circular financing. On the defensive side, MSCI indexes covering health care, consumer staples and utilities have all risen significantly over the past month. Those groups are often treated as steadier choices in volatile markets. Among the S&P Global 1200’s 11 supersectors, health care and consumer staples ranked among the strongest in the second half of 2026 so far, behind energy. Information technology moved in the opposite direction: after gaining 28.4% in the first half, it fell more than 11% in the second half, the weakest sector result. Russ Mould, investment director at AJ Bell, said markets were “in a state of alert.” He argued that sector moves can influence stock selection and may reflect concerns about next year’s economic outlook, as well as doubts about whether enthusiasm for AI has begun to cool. Alastair Pinder, HSBC’s head of emerging markets and global equity strategist, said the defensive rotation appeared extreme even as fundamentals broadly appeared healthy. Pinder put U.S. semiconductor stocks at 13.5 times forward earnings over the next 12 months after a 45% de-rating since June. His comparison placed Nvidia at 13 times forward earnings and Walmart at 40 times. TokenPost previously covered [a similar split between AI-linked stocks and the broader market](). ## Links in this article - [a similar split between AI-linked stocks and the broader market](https://www.tokenpost.com/news/investing/35478)