Berkshire, Walmart and industrials: who benefited from the tech sector correction

During the ongoing sell-off in the technology sector, the securities of investment holding Berkshire Hathaway on February 4, on the contrary, experienced the best day relative to the dynamics of the S&P 500 index for almost a year, Barron's calculated. This, the publication points out, confirms Berkshire's status as a defensive megacorporation amid a declining market. Other sectors that benefited from the reallocation of funds in recent days include consumer staples and industrials, Barron 's and MarketWatch wrote.

Class A Berkshire shares in the afternoon of February 4 in New York added 2.8% to $760,678 per unit, class B securities - rose by 2.8% to $507.55, while the broad index of American stocks - S&P 500 - on the contrary, went down by 0.9%. At the close of trading, the situation changed slightly, with Berkshire's Class A securities ending the day up 2.4%, Class B securities adding 2%, and the S&P 500 losing only 0.5%. Nevertheless, the day, as Barron's writes, was the best for Berkshire Hathaway shares relative to their performance against the S&P 500 in almost a year.

A week ago, the publication calculated that Berkshire shares were lagging the S&P 500 by about 8 percentage points since the start of 2026. Now, however, with growth of about 0.8% since the start of 2026, Berkshire shares are already slightly ahead of the index over the same period, Barron's notes .

The situation, the publication notes, confirms Berkshire stock's status as a defensive stock - thanks to the company's cash hoard of more than $350 billion - a significant portion of Berkshire's $1.1 trillion market capitalization and far more than any other U.S. corporation, Barron's points out.

On February 4, the S&P 500 index went into negative territory for the second day in a row amid investors' continuing concerns about the state of the software industry and the technology sector. Thus, against the background of six consecutive sessions of collapse in the software and IT-services sector, which has already destroyed about $830 billion of market value, 92 stocks from the S&P 500 index on Wednesday, February 4, updated 52-week intraday highs, writes MarketWatch. That's the highest in a single session since Nov. 25, 2024, according to Dow Jones Market Data. Meanwhile, 47 S&P 500 securities hit new all-time intraday highs on Wednesday. Almost half of them are shares of the industrial sector, calculated in MarketWatch (sectoral index S&P 500 Industrials added 0.24% on February 4, while the sectoral S&P 500 Information Technology, focused on technology, lost 1.9%).

In addition, the positive dynamics during the trades on February 4 in the moment showed securities of defense companies (RTX and Northrop Grumman) - they are experiencing a boom due to the increased interest of the U.S. government in defense technologies, writes MarketWatch. Meanwhile, shares of transportation companies (FedEx +2.58% at the close of trading on Wednesday and Norfolk Southern +2.8%) are growing amid expectations of soon reaching a "bottom" in the trucking market, the publication points out.

Also, MarketWatch notes, intraday highs on Wednesday were reached by Walmart - +0.23% at the close of February 4 - their share, as of the end of February 3, accounted for 1.72% of the market capitalization of the S&P 500 index; Exxon Mobil - +2.69% at the end of the session on Wednesday (1.03% in the S&P 500), Johnson & Johnson - +0.59% at the end of February 4 (0.95% of the index). In addition to them, Coca-Cola shares reached a record high, adding 11% in the moment on Wednesday, Barron's notes. By the close of trading, the company's securities corrected and traded in the plus by only 0.6%.

Overall, the group of 47 stocks that set intraday highs on Feb. 4 accounted for just over 11% of the total weight of America's broad stock market, MarketWatch notes.

Martha Norton, chief investment strategist at Empower Investments, believes that the tech sector's decline in recent days looks alarming and may not be the last. Investors are spooked by huge investments in AI, which have yet to yield clear returns, MarketWatch points out. That said, in the longer term, this situation creates opportunities. According to Norton, the market may have sold off too much on stocks from other sectors, even despite their solid financials.

Norton also warned that the sell-off in the software segment, driven by concerns about the potential disruption of software companies' business models due to AI, could spill over into other industries over time. "I'm not sure if large-scale disruption will affect different market segments at once - this is the first such sell-off we're seeing. But in the longer term, we can expect new waves of such disruptions," she said.

This article was AI-translated and verified by a human editor