5 ETFs at the Heart of Last Week's Tech Strength
Zacks Investment Research | Jun 20, 2021 11:10PM ET
The technology sector was the lone bright spot last week among the 11 S&P 500 sectors amid the market turmoil with the S&P 500 Information Technology Sector gaining 0.09%. Optimism surrounding the economic recovery compelled investors to bet on the growth stocks.
The Fed in its recent FOMC meeting stated that rapid vaccinations have reduced the spread of COVID-19 in the United States, strengthening economic activity and employment. As such, it raised GDP growth from 6.5% to 7% for this year, the fastest calendar-year expansion since 1984. The strong economy will continue to fuel demand in the sector. However, the signals of rate hike sooner-than-expected have not deterred the tech stocks as investors believe that low interest rates will remain in place for at least more than a year and provide a huge boost to the sector.
Further, the sector outlook remains solid given the global digital shift even in the post-COVID world with the acceleration in e-commerce for everything, ranging from remote working to entertainment and shopping. The rapid adoption of cloud computing, big data, IoT, wearables, VR headsets, drones, virtual reality, AI, machine learning, digital communication and 5G technology will continue to drive the sector higher (see: Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
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