Woofun AI reports that Ned Davis Research identified two rare divergence signals in US equities: the Philadelphia Semiconductor Index hit new highs while the "Tech Big Seven" lagged, and the Dow Jones diverged from the Nasdaq Composite. On a 26-week rolling basis through mid-June, SOX outperformed the Bloomberg "Tech Big Seven" by over 100 percentage points, with correlation dropping to its lowest since late 2021.

In the seven days ending June 25, the Dow rose 0.5% while the Nasdaq fell 5%, creating a 5.5 percentage point gap seen on only 1% of trading days since 1971. Historical statistics suggest a 66.9% probability of a bear market in the subsequent three months, compared to a 24.8% average. The firm noted that such patterns do not guarantee a downturn but highlight narrow market participation and widening sector divergence.