We're seeing more bifurcation in the markets, says Raymond James' Matt Orton

Summary

Matt Orton sees a bifurcated market where tech and semiconductor shares are under pressure from rising yields while broader breadth, healthcare and financials hold up. He argues investors should favor high-quality free-cash-flow AI beneficiaries over hyperscaler spenders and names Taiwan Semiconductor and Welltower as specific ideas. Orton also calls financials sustainable, would avoid HMOs and utilities, and lists technology, financials and industrials as favorite sectors.

• Tech and chip/memory stocks were hit as rising bond yields weighed on the sector.
• Orton says the broader market is bifurcating, with healthcare and financials showing strength.
• He prefers high free cash flow AI beneficiaries over hyperscaler spenders.
• Taiwan Semiconductor is a favorite after its July pullback due to AI chip leadership and revenue growth.
• Welltower is cited as a healthcare REIT ballast tied to aging demographics.
• Financials, especially banks and capital markets companies, are seen as durable.
• He would avoid HMOs and sees headwinds for utilities.
• Favorite sectors are technology, financials and industrials, including cyclical industrials.