Tech sector continues to perform well, with AI leading the rally, potential rate cuts benefiting

From Nasdaq Media Group: 2024-06-18 08:07:00

The technology sector continues its strong bull run on Wall Street, with the S&P 500 registering 30 record-closes this year, and the Nasdaq Composite hitting record highs in the last six trading days. Year to date, the tech-heavy index is up 20.9%.

Artificial intelligence (AI) is leading the tech rally, with demand for AI chipsets expected to outpace supply, leading to price hikes. The AI market is projected to grow to nearly $2 trillion by 2030, contributing up to $15.7 trillion to the global economy.

Inflation rates are showing favorable data and the labor market remains resilient, with the Federal Reserve indicating potential rate cuts. A low interest rate regime is likely to boost high-growth sectors like technology.

Five U.S. technology giants, including Alphabet, NVIDIA, Micron Technology, Dell Technologies, and Arista Networks, are top picks with strong long-term potential and positive earnings estimates revisions. These stocks have performed well year to date.

Alphabet’s robust cloud division, NVIDIA’s strong fiscal performance, Micron Technology’s growth in AI applications, Dell Technologies’ demand for AI servers, and Arista Networks’ market traction in high-performance switching products make them solid picks for investors.



Read more at Nasdaq Media Group: Tech Turns New Safe Haven Defying Rate Cut Concerns: 5 Picks