The Nasdaq Composite was the stock market leader, roaring to an all-time high a year ago. But now in a deep bear market, it may be awhile before the index and big cap tech can lead stocks higher again. Since that Nov. 19, 2021, closing high, the Nasdaq is down 30.6% versus a nearly 16% decline in the S & P 500. Some of the Nasdaq's stars have fallen just as hard. Microsoft is down 29.6%, and Alphabet has lost about 34%. The damage would be even worse if it weren't for the support of Apple , the biggest stock by market cap, and off by only 6.1% in that time. "Leadership has shifted away from the tech sector and FANMAG. We're not looking for it to return anytime soon," said Ed Clissold, chief U.S. strategist at Ned Davis Research. FANMAG represents Facebook-parent Meta Platforms , Amazon , Netflix , Microsoft, Apple and Google-parent Alphabet. "If you look at previous big sector peaks, not only the dot-com bubble, but financials in '06, energy in '82, once they rotated away, they underperformed for a few years and based for several more," Clissold said. "There's probably quite a bit of time until they return to be outperformers." Two major challenges for tech names Clissold said the tech sector is facing two major challenges. One is the fact the stocks were over owned, and the other is the reshoring of manufacturing to America, which should benefit resource-based stocks like energy, materials and industrials. Tech has benefited from cheaper manufacturing costs in China. Tech has boomed and busted before. The dot-com bubble was the extreme example, when the Nasdaq peaked in March 2000. The bubble burst soon thereafter, and the index did not regain its prior peak for 15 years. "This isn't dot-com 2.0. It's more like the Nifty Fifty in the 1970s, where good companies just got way over owned," he said. "FANMAG is done. These companies are no longer trading in unison, in lockstep. That's partly because their business models are different and some of them are facing major headwinds." He said unlike the dot-com bubble, every company isn't getting hit hard. "It's more about a revaluation reset," he said. Tech and growth stocks have been hit hard by rising interest rates. They tend to have high valuations based on future earnings prospects. As the Federal Reserve raises rates, stocks that fare better when money is cheap will suffer. More lows ahead? The Nasdaq-100 is a closely watched smaller subset of the larger Nasdaq names. The Invesco QQQ Trust is an ETF represnting the index. Katie Stockton, founder of Fairlead Securities, follows that index and says it could get a lift in a year-end rally but then it will likely lose ground again. "I'm not convinced the low we saw recently is the low of the bear market cycle. I think a bear market rally will be followed by a full retracement and take it below recent lows," she said. Stockton said the peak in the Nasdaq last November was also the peak of its outperformance versus the S & P 500. "The message there is really through the bear market cycle, we had downside performance leadership in NDX [Nasdaq-100] versus SPX [S & P 500]," she said. "...To the same point, if you look at large cap growth versus value, it peaked last year." Stockton said she could see a short-term relief rally for big cap tech, but the charts are pointing lower for many names. "We had breakdowns of the heavyweights in the NDX — Microsoft, Amazon, Alphabet, Tesla and Nvidia . They all have breakdowns, and the only one missing is Apple," she said. Outperformance from value names Market strategists are looking for value to continue to outperform. Since Oct. 1, the Dow, helped by industrials and energy, is up 16.4%, while the Nasdaq is up just 4.9%. The S & P 500 in that period is up 9.6%. Bespoke's Paul Hickey points out that the S & P 500 gained 10.4% in the 21 trading days ended Nov. 14 on the back of old economy names. The tech sector outperformed the S & P 500, but it was the materials sector that led the index higher, up about 19%. That was followed by industrials, up 16.5%, and energy up 15%. Hickey said he looked for other periods in which the S & P 500 was up a similar amount in the same time frame, and there were few where those cyclical sectors outperformed tech. But in markets where the cyclials rallied, he found that three, six and 12 months later the broader market was higher and each of the three cyclical sectors was positive. Tech during those period was either in line or performed better than all three. 'You don't necessarily need the big caps which is a lot of the Nasdaq to lead the rally," Hickey said. "It doesn't have to be a leading sector in order for the market to rally." Strategists have expected the market to rally into the end of the year, since in midterm election years, the stocks are typically higher in the fourth quarter. The market has also always been positive from Nov. 1 in a midterm election year to Nov. 1 a year later. Since 1992, the Nasdaq has risen an average 32.6% in those 12-month periods that started in midterm years, according to CFRA. However, the S & P 500 has been up just 20%. "Going back to 1992, technology was the best sector. It rose 100% of the time. The average gain was 31%," said Sam Stovall, chief investment strategist at CFRA. "Right now, we're in a seasonably favorable period for tech. Technology could be a tailwind."