Tech shares have played a major role in the recent January rally, propelling the S&P 500 to reach record levels by the end of last week. However, analysts at Jefferies suggest that the sector may not maintain its market-leading position in February.

According to Jefferies, tech has been the undeniable champion of January, with a monthly gain of nearly 5%, surpassing the S&P 500's 1.5% rise. However, they argue that seasonal factors indicate a potential change in leadership for February.

Historically, tech, along with other defensive sectors like utilities, consumer staples, and healthcare, tend to underperform in February. On the other hand, core cyclicals such as materials, energy, and industrials tend to thrive during this period.

Although tech has bolstered the S&P 500 and propelled the tech-heavy Nasdaq-100 NDX to new highs, Jefferies suggests that a shift in leadership may be on the horizon as earnings season progresses.

Jefferies wrote, "We continue to see opportunities for cyclicals this year, and this could be an indication of when they will get their first chance."

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