How has the stock market performed since the October 2022 lows? The S&P 500’s market’s recovery has been fueled by strong performances in technology and communications services.
Despite various monetary policy, macro-level business, political and geo-political setbacks, the S&P 500 has recovered 22% these past 24-months and shown resilience, driven by strong earnings in strategic sectors amidst challenging macro-economic factors.
This rebound was supported by controlled inflation and favorable Federal Reserve actions, including a 50 basis rate cut in September 2024 that boosted investor confidence.
Finviz: State Street SPDR S&P 500 SPY ETF
Technology Sector
Since October 2022, technology has experienced remarkable 46% gains, largely driven by advancements in artificial intelligence (AI) and strong earnings from major tech companies. However, investors should be aware of potential volatility and valuation concerns in the sector.
Finviz: Fidelity FTEC Technology ETF
Fidelity’s FTEC Technology ETF: Up 46% since Q4-2022, Up 29% in 2024 YTD
Market Sentiment: While there is optimism about the long-term potential of AI and technology stocks, some market participants remain cautious due to potential overvaluation risks.
Future Outlook: The technology sector is expected to continue playing a critical role in market dynamics, but investors are advised to maintain diversified portfolios to mitigate risks associated with potential market corrections.
Top Performers: The broader S&P 500 Index has benefited from the tech sector’s performance, achieving a return of about 22.08% year-to-date.
- Nvidia (NVDA): Nvidia has been a standout performer, with its stock price increasing by over 150% in the first half of 2024. The company has capitalized on the AI boom, particularly in AI chip production, driving significant revenue growth.
- Broadcom (AVGO): Another major winner, Broadcom’s stock rose by approximately 106.04%. The company’s acquisition of VMware and strong sales of AI-related products have contributed to its impressive performance.
- Microsoft (MSFT) & Alphabet (GOOGL): These companies have also seen substantial gains due to their investments in AI technologies and cloud computing services. Microsoft’s stock increased by about 13.55%, while Alphabet saw a rise of approximately 10.74%
Top Losers: Despite the overall positive trend, there have been instances of volatility within the tech sector. In July 2024, the NASDAQ experienced a significant dip due to underwhelming earnings reports from some tech heavyweights like Tesla and Alphabet.
- Name: Fidelity MSCI Information Technology Index ETF
- Category: Technology Sector
- Inception Date: 10-21-2013
- Expense Ratio Fee: 0.08%
- Assets Under Management: $12B AUM
- Holdings: 294 Stocks
| COMPANY | SYMBOL | TOTAL NET ASSETS |
|---|---|---|
| NVIDIA Corporation | NVDA | 15.87% |
| Apple Inc. | AAPL | 15.68% |
| Microsoft Corp. | MSFT | 13.59% |
| Broadcom, Inc. | AVGO | 4.48% |
| Oracle Corporation | ORCL | 1.83% |
| Salesforce, Inc. | CRM | 1.82% |
| Advanced Micro Devices, Inc. | AMD | 1.58% |
| Accenture PLC Class A | ACN | 1.47% |
| Cisco Systems, Inc. | CSCO | 1.47% |
| Adobe Inc. | ADBE | 1.42% |
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