Tech Stocks Ripe for More Bullishness

Though it encountered some hiccups last month amid fears the Federal Reserve isn’t done raising interest rates, tech remains one of this year’s best-performing sectors. Some analysts believe there’s more upside to come for the S&P 500’s largest sector weight.

Should that assessment prove accurate, exchange traded funds such as the Invesco QQQ Trust (QQQ) and the Invesco NASDAQ 100 ETF (QQQM) stand to benefit. The two funds are among the primary ETF beneficiaries of this year’s artificial intelligence (AI) investing renaissance. Many market observers believe it is a harbinger of another tech revolution that could propel the sector higher for years to come.

“We believe key solid results/guidance last night from the likes of tech stalwarts Salesforce, Okta, and Crowdstrike reinforce our thesis that a modestly improving IT spending environment on the heels of this 1995-like AI Revolution creates a bullish set up for tech stocks into year-end and 2024,” according to Wedbush. “We believe tech stocks rip higher into year-end with the new tech bull market here.”

QQQM Relevant for the Long-Term

Wedbush’s 1995 mention harkens to the early days of the consumer internet/e-commerce boom. Some investors considering QQQ and QQQM may be leery of that comparison. What was in style in the mid- to late 1990s ultimately burst, in dramatic fashion.

However, QQQ and QQQM member firms are better positioned today to endure bubble speculation as many holdings in the ETFs are among the most cash-rich firms in Corporate America. Wedbush’s adulation for the AI boom doesn’t end with the 1995 comparison. The research firm joined an array of counterparts in noting this could be another iPhone moment for the tech sector.