Equity market rotation will continue to play out, says Piper Sandler's Craig Johnson

Watch on YouTube ↗  |  January 21, 2026 at 20:11  |  2:06  |  CNBC
Speakers
Craig Johnson — Chief Market Technician, Piper Sandler
Brian Sullivan — Anchor, CNBC (Last Call / Power Lunch)

Summary

Craig Johnson, Piper Sandler chief market technician, says the equity market is resilient and experiencing a rotation out of mega-cap Mag 7 names into down-cap areas. He attributes part of the move to unwinding yen-funded carry trades. He favors energy and healthcare, highlighting constructive charts in Schlumberger and Halliburton and Medtronic's outperformance versus Boston Scientific. He also sees Apple and Microsoft charts rolling over.

  • Craig Johnson says market technical damage is not severe and the market is resilient.
  • He expects rotation out of Mag 7 stocks into down-cap areas to continue.
  • Yen-funded carry trade unwinding is contributing to the rotation.
  • Energy charts, including Schlumberger and Halliburton, look constructive.
  • Healthcare is showing signs of life, with Medtronic outperforming Boston Scientific.
  • Apple and Microsoft charts appear distributional and are rolling over.
Ideas
Craig Johnson Chief Market Technician, Piper Sandler 0:44
Rotation from Mag 7 to down-cap continues
The market is resilient and technical damage has not been severe. It is rotating out of Mag 7 stocks and into down-cap areas, driven by the unwinding of yen-funded carry trades that had been levered into Mag 7. Mag 7 charts are now lagging while other stocks pick up the baton, and this rotation should continue.
Down-cap equities HIGH
Craig Johnson Chief Market Technician, Piper Sandler 0:44
Rotation from Mag 7 to down-cap continues
The market is resilient and technical damage has not been severe. It is rotating out of Mag 7 stocks and into down-cap areas, driven by the unwinding of yen-funded carry trades that had been levered into Mag 7. Mag 7 charts are now lagging while other stocks pick up the baton, and this rotation should continue.
MAGS HIGH
Craig Johnson Chief Market Technician, Piper Sandler 1:35
Apple and Microsoft charts rolling over
Apple and Microsoft have distributional-looking charts that are rolling over, making them less attractive than down-cap names for making money now.
AAPL MSFT MED
Craig Johnson Chief Market Technician, Piper Sandler 1:44
Energy charts look constructive, favor Schlumberger Halliburton
Energy is a stronger down-cap area. Schlumberger and Halliburton charts look much more constructive, suggesting the sector is favored.
XLE SLB HAL MED
Craig Johnson Chief Market Technician, Piper Sandler 1:56
Healthcare heartbeat; Medtronic beats Boston Scientific
Healthcare is showing signs of life after a long period without a heartbeat. Medtronic is outperforming Boston Scientific, a bullish technical signal for the sector.
XLV MDT MED
Craig Johnson Chief Market Technician, Piper Sandler 1:56
Healthcare heartbeat; Medtronic beats Boston Scientific
Healthcare is showing signs of life after a long period without a heartbeat. Medtronic is outperforming Boston Scientific, a bullish technical signal for the sector.
BSX MED
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This CNBC video, published January 21, 2026, features Craig Johnson discussing Down-cap equities, MAGS, AAPL, MSFT, XLE, SLB, HAL, XLV, MDT, BSX. 6 trade ideas extracted by AI with direction and confidence scoring.

Speakers: Craig Johnson  · Tickers: Down-cap equities, MAGS, AAPL, MSFT, XLE, SLB, HAL, XLV, MDT, BSX