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Bull Market Showing Signs of Fatigue

  //stocks-investing.news-articles.net/content/2026/02/12/bull-market-showing-signs-of-fatigue.html
  Published in Stocks and Investing on Thursday, February 12th 2026 at 11:23 GMT by MarketWatch
      Locales: California, Texas, Washington, New York, Massachusetts, New Jersey, Illinois, UNITED STATES

By [Your Name], Market Analyst

Thursday, February 12th, 2026 - After a sustained period of growth, the current bull market is facing increasing scrutiny. Investors are understandably anxious about the inevitable market correction, and pinpointing the timing of such a shift has proven consistently challenging. Recent analysis conducted by MarketWatch - and now further corroborated by independent financial modeling - indicates that the rally may be losing steam, with key performance indicators suggesting a potential peak is approaching. This isn't necessarily a prediction of an immediate crash, but a strong signal for investors to exercise increased caution and re-evaluate their portfolios.

The core of this analysis centers on the concept of relative strength. Relative strength, in this context, measures a stock's performance against a benchmark - in this case, the S&P 500. A relative strength exceeding 1.0 signifies outperformance, meaning the stock has yielded higher returns than the broader market. Conversely, a reading below 1.0 indicates underperformance. Historically, stocks maintaining a relative strength of 1.0 or above have been hallmarks of a thriving bull market.

However, a concerning trend has emerged. MarketWatch identified 32 stocks, all with market capitalizations exceeding $20 billion and significant institutional ownership (held by at least 200 institutional investors), that have recently witnessed their relative strength fall below the critical 1.0 threshold. This shift isn't a sudden drop; rather, it represents a consistent deterioration in performance relative to the overall market. This suggests that these previously high-flying stocks are losing momentum and could drag down the broader market.

The list of these 32 stocks includes some of the most recognizable names in the tech, consumer discretionary, and industrial sectors:

• Tech Giants: Adobe (ADBE), Advanced Micro Devices (AMD), Alphabet (GOOG), Apple (AAPL), ASML Holding (ASML), Broadcom (AVGO), Nvidia (NVDA), Qualcomm (QCOM), Texas Instruments (TXN), Datadog (DDOG), Snowflake (SNOW).
• Consumer Powerhouses: Amazon (AMZN), Costco (COST), Electronic Arts (EA), Las Vegas Sands (LVS), Match Group (MTCH), PayPal (PYPL).
• Industrial and Healthcare Leaders: Analog Devices (ADI), Cisco Systems (CSCO), Edwards Lifesciences (EW), General Electric (GE), Home Depot (HD), IBM (IBM), Old Dominion Freight Line (ODFL).
• Software and Fintech: DocuSign (DOCU), Fortinet (FTNT), Salesforce (CRM), Square (SQ), Workday (WD), Xerox (XRX), Delta Air Lines (DAL).

Deeper Dive into the Declining Strength

The reasons behind this weakening relative strength are multifaceted. Several factors are contributing to this trend. Rising interest rates are beginning to impact growth stocks, making future earnings less attractive to investors. Inflation, though moderating, continues to erode consumer purchasing power, impacting discretionary spending and, consequently, companies like Amazon and Las Vegas Sands. Supply chain disruptions, while easing, still linger, particularly in the semiconductor industry, affecting companies like AMD and Nvidia. Furthermore, the macroeconomic environment is increasingly uncertain with geopolitical tensions adding to the volatility.

Looking at specific examples, Adobe's slowing growth in creative software subscriptions and increased competition are affecting its performance. Nvidia, while still a dominant force, is facing headwinds from slowing demand for gaming GPUs and the cyclical nature of the chip industry. Amazon's e-commerce growth is decelerating as consumers return to brick-and-mortar stores, and its cloud computing division (AWS) is facing tougher competition. Even seemingly resilient companies like Costco are exhibiting signs of slowing same-store sales growth.

Implications for Investors - Not a Time to Panic, But a Time to Prepare

It's crucial to emphasize that this analysis isn't a harbinger of an immediate market collapse. However, it is a strong indicator that the easy money has been made in this cycle. Investors should avoid complacency and proactively manage their risk. This doesn't necessarily mean selling off all holdings, but it does suggest:

• Diversification: Ensuring a well-diversified portfolio across different asset classes and sectors can mitigate potential losses.
• Profit-Taking: Consider taking profits on positions that have experienced significant gains, particularly in those stocks exhibiting declining relative strength.
• Defensive Positioning: Shifting towards more defensive sectors, such as healthcare and consumer staples, may provide some protection during a downturn.
• Cash Allocation: Increasing cash reserves provides flexibility to capitalize on potential buying opportunities when the market eventually corrects.
• Long-Term Perspective: Remember that market corrections are a natural part of the economic cycle. Maintaining a long-term investment horizon and avoiding emotional decision-making are key to success.

This isn't about predicting the future; it's about recognizing the warning signs and preparing for the possibility of a more challenging market environment. Prudent investors will heed these signals and adjust their strategies accordingly.