A volatile, choppy sideways consolidation has taken the S&P 500 precisely nowhere for three months.

This is unsurprising given the exceptional momentum rally following the April 2025 market bottom – equities simply needed to take a breath.

Actually more noticeable is the resilience of the index in the face of a veritable blood bath across whole sectors.

Over the short- to medium-term a split market and strong rotation is beginning to raise some red flags, which jibes with the observation that midterm election years tend to be difficult.

This may require some patience, but my outlook for the year overall remains positive.

This is supported by positive returns around the turn-of- the year, which tend to foreshadow annual performance.