The stock market's decline can set you up with investment opportunities

MW The stock market's decline can set you up with investment opportunities

By Philip van Doorn

Also: The MarketWatch 25, dividend stocks, and next year's limits for retirement-account contributions

The information-technology sector has powered the S&P 500's stellar performance this year - but it has been the index's weakest performer in November.

Thursday's sharp stock-market selloff included a 1.7% decline for the S&P 500 and a 2.4% decline for its information-technology sector. That may not seem to be a problem, with the sector posting such large gains for 2025 before that trading session. But it might signal a rotation for the market into more defensive sectors, or at least a breather for technology stocks in light of their high valuations.

Here is a look at the 11 sectors of the S&P 500 SPX with weighted forward price-to-earnings ratios compared with 10-year average valuations. These are share prices divided by rolling 12-month earnings-per-share estimates among analysts polled by LSEG, weighted by market capitalization. The list is sorted by current P/E ratios, with the full index at the bottom:

   Sector or Index           Forward P/E  10-year average P/E  Forward P/E to 10-year average 
   Real Estate                      35.5                40.59                             88% 
   Information Technology           29.7                22.19                            134% 
   Consumer Discretionary           29.3                24.18                            121% 
   Industrials                      23.7                18.93                            125% 
   Communication Services           21.1                16.86                            125% 
   Consumer Staples                 20.5                19.90                            103% 
   Utilities                        18.8                17.88                            105% 
   Materials                        18.1                17.52                            103% 
   Healthcare                       17.3                16.25                            106% 
   Financial                        15.8                13.69                            115% 
   Energy                           15.2                22.94                             66% 
   S&P 500 Index                    22.6                18.78                            121% 
                                                                              Source: FactSet 

The information-technology sector XX:SP500.45 was the most expensive on a forward P/E basis, after the real-estate sector XX:SP500.60. But the IT sector was trading 34% higher than its average 10-year valuation.

For one week through Thursday, the IT sector of the S&P 500 was down 4.2%, the worst performance among the 11 sectors.

Here is coverage of this week's stock-market trends and some looks ahead:

-- Dow's big drop after a record close is fairly rare. How doubts about December rate cut are weighing on Wall Street.

-- Institutional investors are buying the dip in stocks while the retail crowd takes a breather

-- Wall Street's on edge. These are the levels that stocks must not violate, says Fundstrat.

-- Nomura strategist warned the market selloff was coming. Here are the forces he says are taking stocks down.

-- Why options traders think Dec. 10 will be the most important day for markets before the end of 2025

Bucking the trend

Plenty of stocks in the S&P 500 showed double-digit declines for November through Thursday. But shares of Eli Lilly & Co. $(LLY)$ were up 18.5%. Jaimy Lee, who has returned to MarketWatch as Health Editor, explained how a new arrangement with Medicare has been helping to boost Eli Lilly's stock to record highs.

Opportunities as stock prices decline

Hormel Foods is among the stocks recommended by professional investors following October price declines brought about, at least in part, by tax-related selling by fund managers.

Michael Brush highlighted stocks made more compelling by the delay of the annual "November effect," following selling of stocks during October by fund managers to book some losses to offset taxable capital gains. Here are seven stocks that are now on sale after tax-related selling.

And for risk-averse investors, Mark Hulbert dug into four exchange-traded funds that take varying approaches to holding dividend stocks. Here's how these dividend-stock ETFs might fit in with your portfolio.

The MarketWatch 25 can help you with your money - and even your health

The MarketWatch 25 series features deep and detailed interviews with professionals with influence over markets, money and policy.

The annual MarketWatch 25 kicked off this week, featuring in-depth interviews with people who have a lot of influence on your money, your work and even your health.

-- Emily Bary interviewed Regina Barzilay, a computer-science professor at MIT, who has co-developed a system that uses generative artificial intelligence to analyze results of breast-cancer screening and make early detection more likely.

-- Gregg Robb interviewed Beth Hammack, the president of the Federal Reserve Bank of Cleveland, who described her efforts to reduce inflation.

-- Frances Yue spoke with Jeremy Allaire, co-founder of Circle Internet Group Inc. CRCL who believes stablecoins will be important to you over the long term.

-- Beth Pinsker had a conversation with Ai-jen Poo, who co-founded the National Domestic Workers Alliance as part of her efforts to bring attention to the rising cost of home care as the U.S. population ages, and to recommend changes in government policy to help keep families' costs down.

-- Aarthi Swaminathan interviewed Leo Pareja, the chief executive of eXp Realty, who explained how his team of hundreds of real-estate agents is working with home buyers and sellers as to navigate a depressed market for sales as the housing affordability crisis continues.

-- Isabel Wang described Tom Lee - co-founder of Fundstrat Global Advisors and chair of BitMine Immersion Technologies Inc. BMNR - as "Wall Street's biggest bull." Lee shared his predictions for the stock market and for bitcoin BTCUSD.

Here is the list of MarketWatch 25 articles that will be updated as more are published.

And here is the full list of 25 people who are influential in money and markets that will be featured the series.

Coverage of companies and tech

Here are examples of MarketWatch's coverage of developments at various companies this week:

-- Walmart is losing a big winner, as longtime CEO Doug McMillon is retiring

-- Here's what's different about this year's Starbucks strikes, as union drive nears 4-year anniversary

-- Delta CEO says the quiet part out loud: Airlines were a 'political football' during shutdown.

-- Jeff Bezos's Blue Origin matches SpaceX as it lands its mega-rocket's booster

-- IBM sees a big milestone ahead for quantum computing - and it hinges on these new chips

-- Nvidia's stock has a strong setup ahead of next week's earnings, this analyst says

Could your money be used for a government AI bailout?

Any broad business trend can lead to overbuilding. For example, you might have new and empty warehouse facilities nearby, waiting to be rented out. In light of the federal government's efforts to support the AI infrastructure buildout, Christine Ji looked into whether or not there may eventually be pressure for a government backstop for AI companies.

Robinhood's new service can save you from an annoying trip

Robinhood's new service will deliver cash to your door.

Even as people lean more toward making electronic payments, you need cash for some things. Robinhood Markets Inc. (HOOD) is rolling out a new service for its brokerage customers: delivering cash to your door. Here's how the service will work and how Robinhood says it will keep you safe while delivering your cash.

Retirement planning

In the TaxWatch column, Andrew Keshner broke down the Internal Revenue Service's new 2026 limits for retirement-account contributions, including a special treat for workers between the ages of 50 and 59.

In the Help Me Retire column, Alessandra Malito dug into some tricky rules for people who want to begin receiving Social Security benefits at the earliest age of 62. How much will their benefits be reduced if they continue working after they start taking Social Security payments?

The Moneyist: 'This is not quite a relationship of financial equals'

Quentin Fottrell is the Moneyist.

What if two divorced people in their 50s decide to get married? There are many advantages, but also complications when it comes to retirement and estate planning. Quentin Fottrell - the Moneyist - worked through one such marriage scenario with a MarketWatch reader.

More from the Moneyist:

-- 'She'll probably marry her current boyfriend': Should I give my daughter my $300K house - or gift her the cash to buy it?

-- 'Our HOA fees are too high': My husband and I are retired. Should we sell our $700K condo and rent instead?

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-Philip van Doorn

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November 14, 2025 14:20 ET (19:20 GMT)

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