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Tech Rally to Continue Despite Market Plunge: 5 Solid Buys
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On Jun 11, U.S. markets suffered their biggest single-day loss since mid-March on growing concerns over the increasing number of coronavirus cases as states slowly start reopening. Thursday’s decline also followed the Federal Reserve’s warning on Wednesday that the U.S. economy will contract by 6.5% in 2020 before expanding by 5% next year.
Among the biggest casualties on Thursday were the big tech companies that boast names like Apple, Inc. (AAPL - Free Report) Amazon.co, Inc. (AMZN - Free Report) , Facebook, Inc. , Microsoft Corporation (MSFT - Free Report) and Alphabet, Inc. (GOOGL - Free Report) , which lost more than $269 billion in market value. Tech stocks have been driving the market rally since mid-March and have been one of the least-affected sectors during the peak of the coronavirus pandemic.
Given the increasing dependence on technology during the pandemic, it is likely that the tech rally will continue despite Thursday’s market crash. This thus gives the perfect opportunity to those who missed the previous chance to invest their money in tech stocks.
Stocks Suffer on Multiple Fears
U.S. stocks nosedived on Jun 11 following the Federal Reserve’s monetary policy decision to maintain 0% interest rate and asset buyback programs till 2022. Policymakers stressed on the ongoing economic concerns spurred by the coronavirus pandemic and measures taken to contain it. All three major indexes ended in red. The Dow shed 1,861.8 points, declining 6.9%, while the S&P 500 slipped 5.9% to 3,002 points. Also, the tech-heavy Nasdaq dropped 5.3% to end the day at 9,492.7 points.
This was the worst day for all three major indexes since Mar 16, when they all declined over 11%. Investors, who had been pinning their hopes on a quick recovery once the economy reopened, dumped stocks on fresh worries of a surge in coronavirus cases. Another reason for the huge selloff was the Fed Reserve’s warning a day before that the U.S. economy would contact 6.5% in 2020 before expanding 5% in 2021.
Tech Stocks Hit Hard
The unexpected victims of Thursday’s market plunge were the tech stocks. The big five tech companies which were responsible for the market rally since Mar 16 together lost more than $269 billion. Microsoft was the biggest casualty, losing over $80 billion in value as shares plummeted more than 5%. Also, shares of Facebook declined 5%, while Apple shed 4.8%. Alphabet ended the day down 4.3%, while Amazon gave up 3.38%.
However, tech stocks have been one of the best performers and have been driving the rally for quite some time. The coronavirus pandemic has seen an increasing number of people getting dependent on technology, as working and learning remotely and shopping online have become the new normal. This has led to a shift in data and information to technological and digital platforms to safely remain afloat.
So in spite of Thursday’s plunge, the Technology Select Sector SPDR’s (XLK) 7.1% year-to-date return is a testimony to the fact the tech rally has legs.
Our Choices
In fact, now is an ideal time for those who missed out on the opportunity to invest in the lucrative tech stocks to buy on the dip. We have shortlisted four tech stocks that are sure to benefit from soaring demand in the coming months. Now is an ideal time to buy these lucrative tech stocks on the dip.
Zoom Video Communications, Inc’s (ZM - Free Report) cloud-native unified communications platform, which combines video, audio, phone, screen sharing and chat functionalities, makes remote-working and collaboration easy.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 174.4% over the past 30 days. Zoom Video sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Dropbox, Inc. (DBX - Free Report) is a service company. It offers a platform which enables users to store and share files, photos, videos, songs and spreadsheets. Dropbox, Inc. is headquartered in San Francisco, CA.
The company’s expected earnings growth rate for the current year is 48%. The Zacks Consensus Estimate for current-year earnings has improved 5.7% over the past 60 days. Dropbox sports a Zacks Rank #1.
Logitech International S.A. (LOGI - Free Report) is a global leader in peripherals for personal computers and other digital platforms, which develops and markets innovative products in PC navigation, Internet communications, digital music, home-entertainment control, video security, interactive gaming and wireless devices.
The company’s expected earnings growth rate for the current year is 5.1%. The Zacks Consensus Estimate for current-year earnings has improved 3.7% over the past 60 days. Logitech has a Zacks Rank #1.
Netflix, Inc. (NFLX - Free Report) is considered a pioneer in the streaming space. The company evolved from a small DVD-rental provider to a dominant streaming service provider courtesy of its wide-ranging content portfolio and a fortified international footprint.
The company’s expected earnings growth rate for the current year is 55.5%. The Zacks Consensus Estimate for current-year earnings has improved 7% over the past 60 days. Netflix carries a Zacks Rank #2 (Buy).
NVIDIA Corporation (NVDA - Free Report) is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence-based solutions that now support high performance computing, gaming and virtual reality platforms.
The company’s expected earnings growth rate for the current year is 36.4%. The Zacks Consensus Estimate for current-year earnings has improved 4.4% over the past 60 days. NVIDIA holds a Zacks Rank #2.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
Image: Bigstock
Tech Rally to Continue Despite Market Plunge: 5 Solid Buys
On Jun 11, U.S. markets suffered their biggest single-day loss since mid-March on growing concerns over the increasing number of coronavirus cases as states slowly start reopening. Thursday’s decline also followed the Federal Reserve’s warning on Wednesday that the U.S. economy will contract by 6.5% in 2020 before expanding by 5% next year.
Among the biggest casualties on Thursday were the big tech companies that boast names like Apple, Inc. (AAPL - Free Report) Amazon.co, Inc. (AMZN - Free Report) , Facebook, Inc. , Microsoft Corporation (MSFT - Free Report) and Alphabet, Inc. (GOOGL - Free Report) , which lost more than $269 billion in market value. Tech stocks have been driving the market rally since mid-March and have been one of the least-affected sectors during the peak of the coronavirus pandemic.
Given the increasing dependence on technology during the pandemic, it is likely that the tech rally will continue despite Thursday’s market crash. This thus gives the perfect opportunity to those who missed the previous chance to invest their money in tech stocks.
Stocks Suffer on Multiple Fears
U.S. stocks nosedived on Jun 11 following the Federal Reserve’s monetary policy decision to maintain 0% interest rate and asset buyback programs till 2022. Policymakers stressed on the ongoing economic concerns spurred by the coronavirus pandemic and measures taken to contain it. All three major indexes ended in red. The Dow shed 1,861.8 points, declining 6.9%, while the S&P 500 slipped 5.9% to 3,002 points. Also, the tech-heavy Nasdaq dropped 5.3% to end the day at 9,492.7 points.
This was the worst day for all three major indexes since Mar 16, when they all declined over 11%. Investors, who had been pinning their hopes on a quick recovery once the economy reopened, dumped stocks on fresh worries of a surge in coronavirus cases. Another reason for the huge selloff was the Fed Reserve’s warning a day before that the U.S. economy would contact 6.5% in 2020 before expanding 5% in 2021.
Tech Stocks Hit Hard
The unexpected victims of Thursday’s market plunge were the tech stocks. The big five tech companies which were responsible for the market rally since Mar 16 together lost more than $269 billion. Microsoft was the biggest casualty, losing over $80 billion in value as shares plummeted more than 5%. Also, shares of Facebook declined 5%, while Apple shed 4.8%. Alphabet ended the day down 4.3%, while Amazon gave up 3.38%.
However, tech stocks have been one of the best performers and have been driving the rally for quite some time. The coronavirus pandemic has seen an increasing number of people getting dependent on technology, as working and learning remotely and shopping online have become the new normal. This has led to a shift in data and information to technological and digital platforms to safely remain afloat.
So in spite of Thursday’s plunge, the Technology Select Sector SPDR’s (XLK) 7.1% year-to-date return is a testimony to the fact the tech rally has legs.
Our Choices
In fact, now is an ideal time for those who missed out on the opportunity to invest in the lucrative tech stocks to buy on the dip. We have shortlisted four tech stocks that are sure to benefit from soaring demand in the coming months. Now is an ideal time to buy these lucrative tech stocks on the dip.
Zoom Video Communications, Inc’s (ZM - Free Report) cloud-native unified communications platform, which combines video, audio, phone, screen sharing and chat functionalities, makes remote-working and collaboration easy.
The company’s expected earnings growth rate for the current year is more than 100%. The Zacks Consensus Estimate for current-year earnings has improved 174.4% over the past 30 days. Zoom Video sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Dropbox, Inc. (DBX - Free Report) is a service company. It offers a platform which enables users to store and share files, photos, videos, songs and spreadsheets. Dropbox, Inc. is headquartered in San Francisco, CA.
The company’s expected earnings growth rate for the current year is 48%. The Zacks Consensus Estimate for current-year earnings has improved 5.7% over the past 60 days. Dropbox sports a Zacks Rank #1.
Logitech International S.A. (LOGI - Free Report) is a global leader in peripherals for personal computers and other digital platforms, which develops and markets innovative products in PC navigation, Internet communications, digital music, home-entertainment control, video security, interactive gaming and wireless devices.
The company’s expected earnings growth rate for the current year is 5.1%. The Zacks Consensus Estimate for current-year earnings has improved 3.7% over the past 60 days. Logitech has a Zacks Rank #1.
Netflix, Inc. (NFLX - Free Report) is considered a pioneer in the streaming space. The company evolved from a small DVD-rental provider to a dominant streaming service provider courtesy of its wide-ranging content portfolio and a fortified international footprint.
The company’s expected earnings growth rate for the current year is 55.5%. The Zacks Consensus Estimate for current-year earnings has improved 7% over the past 60 days. Netflix carries a Zacks Rank #2 (Buy).
NVIDIA Corporation (NVDA - Free Report) is the worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU. Over the years, the company’s focus has evolved from PC graphics to artificial intelligence-based solutions that now support high performance computing, gaming and virtual reality platforms.
The company’s expected earnings growth rate for the current year is 36.4%. The Zacks Consensus Estimate for current-year earnings has improved 4.4% over the past 60 days. NVIDIA holds a Zacks Rank #2.
Biggest Tech Breakthrough in a Generation
Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.
A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft in the 1990s. Zacks’ just-released special report reveals 8 stocks to watch. The report is only available for a limited time.
See 8 breakthrough stocks now>>