Is the inventory market in correction territory? It is determined by what you imply by inventory market.
The Dow Jones Industrial Common(DJINDICES: ^DJI) and the Nasdaq Composite Index(NASDAQINDEX: ^IXIC) are certainly in correction. However, maybe surprisingly, the S&P 500(SNPINDEX: ^GSPC) is not (not less than as of the market shut on Friday, March 27, 2026).
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Over the previous few years, the so-called “Magnificent Seven” shares have fueled the S&P 500’s spectacular good points. Nevertheless, all seven shares have plunged by double-digit percentages yr thus far. If the Magnificent Seven is not stopping the S&P 500 from slipping into correction territory, which shares are? 5 shares particularly stand out.
Picture supply: Getty Photographs.
Power shares have been scorching sizzling in 2026. Oil and fuel costs skyrocketed following the U.S. and Israeli assaults on Iran. With Iran successfully blocking passage by means of the very important Strait of Hormuz, commodity costs have remained excessive. Unsurprisingly, the vitality sector is the one S&P 500 sector to ship double-digit year-to-date good points.
Fortuitously for the S&P 500, two vitality giants amongst its prime 20 largest elements have been big winners. ExxonMobil(NYSE: XOM) has the Thirteenth-highest weight within the S&P 500. Chevron(NYSE: CVX) has the Nineteenth-largest weight. Each shares have soared round 40% to this point this yr.
Whereas ExxonMobil and Chevron each operated big built-in oil and fuel operations, their companies are considerably completely different. ExxonMobil’s upstream oil manufacturing is now considerably extra worthwhile because of greater oil costs. Chevron advantages from these excessive costs as effectively, nevertheless it’s additionally engaging as the biggest U.S. pure fuel producer.
Inflation was already a priority earlier than the Iran battle. With oil costs rising, it is a good larger fear. Larger gas prices may push up costs throughout a variety of merchandise. That is unhealthy information for many shares. Nevertheless, it might truly be excellent news for prime client staples shares like Walmart(NASDAQ: WMT) and Costco Wholesale(NASDAQ: COST).
Walmart’s and Costco’s companies have traditionally been comparatively proof against inflation. Customers who’re tightening their purse strings nonetheless store at Walmart and Costco shops as a result of they know each corporations supply low costs. Traders know this, too. That is a giant cause why Walmart’s and Costco’s shares have been up by greater than 10% yr thus far as of the tip of final week.
These good points have helped prop up the S&P 500. Walmart sits simply outdoors the index’s prime 10 elements at No. 11, whereas Costco is not too far behind at No. 17.
It is sensible that vitality shares and client staples shares are faring effectively within the present atmosphere. Nevertheless, there’s one notable outlier from a stunning sector that is additionally a key issue behind the S&P 500 avoiding a correction so far — Micron Expertise(NASDAQ: MU).
Regardless of a major latest pullback, Micron’s shares stay up by a formidable quantity yr thus far. The corporate’s high-bandwidth reminiscence (HBM) is a important element for synthetic intelligence (AI) infrastructure. So is its NAND flash reminiscence. Micron is having fun with unprecedented pricing energy in reminiscence as a consequence of terribly excessive demand for AI chips.
In contrast to the Magnificent Seven shares, Micron’s valuation wasn’t sky-high earlier than the Center East turmoil started. It nonetheless is not, with shares buying and selling at solely 7.6 occasions ahead earnings. Micron is the highest-weighted tech inventory outdoors the Magnificent Seven and Broadcom(NASDAQ: AVGO) within the S&P 500, rating No. 20.
Has the Magnificent Seven period of the S&P 500 giving option to the “Foundational 5” period that includes ExxonMobil, Chevron, Walmart, Costco, and Micron? I would not go that far.
Ought to a peaceable decision be reached among the many U.S., Israel, and Iran, oil and fuel costs would probably fall — together with ExxonMobil’s and Chevron’s shares. A “risk-off” local weather may additionally trigger traders to shift away from safe-haven shares reminiscent of Walmart and Costco into different alternate options. In the meantime, Micron’s luster seems to be fading amid fears that technological advances may cut back demand for its reminiscence chips.
Additionally, these 5 shares have not prevented an S&P 500 correction on their very own. The index consists of over 100 different shares which have additionally delivered good points of 10% or extra this yr.
Most significantly, although, I do not assume the S&P 500 is wherever near being out of the woods but. It is nonetheless fairly doable that the index slips into correction territory (maybe even by the point you are studying this).
If there is a takeaway for traders, it is that portfolio diversification issues. The shares that drive the market one yr won’t be those that achieve this the subsequent.
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Keith Speights has positions in Chevron and ExxonMobil. The Motley Idiot has positions in and recommends Chevron, Costco Wholesale, Micron Expertise, and Walmart. The Motley Idiot recommends Broadcom. The Motley Idiot has a disclosure coverage.
5 Shares Stopping a S&P 500 Correction (Trace: None Are within the “Magnificent Seven”) was initially printed by The Motley Idiot
