Investors and strategists have revealed how to play in the battered tech sector, as they identify several stock opportunities in a market they say may be approaching bottom. Lee Baker, owner and president of Apex Financial Services, described Apple and Microsoft as “good, solid companies” for investors to consider now. Speaking to CNBC’s Squawk Box Europe on Friday – before the market’s temporary recovery and subsequent fall – he said the tech market is “very close” to the bottom. “You can look at the Nasdaq and think of it as a big basket. I don’t know I’m willing to dive particularly into the tech sector as a whole. But companies like Apple or Microsoft that you know are strong, good companies, that have to come out on the other side of this in good shape, She’s starting to look especially attractive.” “Apple continues to innovate again and again. It is held back by some supply chain issues, just like everyone else, but [are] A very selling company.” The tech-heavy Nasdaq is down about 27% in the year to date, hitting a 52-week low on May 12. Apple shares are down about 20% in 2022, while Microsoft shares are down 24%. Baker recommends investors consider To a three- to five-year time horizon when buying shares in companies. “Defensible profit margins” Apple is also a pick for Patrick Armstrong, chief investment officer at Plurimi Wealth Management. Talk to CNBC Thursday, the day after both the Dow Jones Industrial Average incurred and the S&P 500, their biggest loss since 2020, said, “I own Alphabet and I own Apple … These are companies that have defensible profit margins, they have dominant market positions, they are buying back shares.” Meanwhile, David Sekera, Morningstar’s chief US market strategist, loves Alphabet, Amazon, Microsoft, and Meta.” In a year now, the price of each of these stocks has fallen more than the overall market average, yet we remain convinced of the value of these “companies for long-term investors,” he told CNBC on Tuesday. Be selective, Christina Huber, chief global market strategist at Invesco, likened the current technical fallout to the bursting of the dotcom bubble. “What I think we’ll see is a smaller version of what we saw in 2000 and 2001, where the more speculative parts of tech will get squeezed. We can see some failures, but a lot of technology,” she told CNBC’s Squawk Box Europe on Friday. “You will come out of this stronger.” Plurimi’s Armstrong said he has short positions in Just Eat Takeaway, Delivery Hero and Ocado, helping him offset a loss for renewable energy company Siemens Gamesa, whose stock rose on Wednesday after news of a full takeover bid from Siemens Energy Investors short selling stocks make money when the price of those assets drops Looking ahead, Huber said she believes the technology sector will hold up after the Fed increases The Fed raised interest rates by half a percentage point on May 4 and is set to continue the cycle.” “If we look historically at the performance of the tech sector during the Fed rate hike cycles after an initial difficulty — because they once again went through the reassessment process, especially because of higher valuations — they have Technology stocks have held up relatively well historically during these price-raising cycles, she said. As such, Huber recommended that you be selective when purchasing technology. “Focus on companies with strong cash flows with wider net profit margins… Those companies have been hit hard as well, but I think they really are buying opportunities.” She added that volatile market sentiment was often driven by a “very deep and very emotional reaction”. “There’s not a lot of selectivity and thoughtfulness in these types of sales,” she said. “This really creates great buying opportunities for those who are picky and thoughtful.” Peter Garnery, head of equity strategy at Saxo Bank, likened “long-term winners” to tech sell-offs to the dot-com crash in 2000, and said it was time to look for “long-term winners”. “We will have a lot of blood on the street, and there will be casualties, but among those victims there will be long-term winners, just like Microsoft, Amazon and [and chip stocks] Qualcomm, Intel and AMD took big losses in the dotcom explosion, there are still long-term winners,” he told CNBC’s Squawk Box Europe on May 9. He favored the commodities, cyber security, defence, logistics and renewable energy sectors as the sectors to watch over the next eight to ten years. CNBC’s Xavier Ong contributed to this report.
A trader works on the floor of the US NYSE options market at the New York Stock Exchange, April 16, 2018.
Brendan McDermid | Reuters
Investors and strategists have revealed how to play in the battered tech sector, as they identify several stock opportunities in a market they say may be approaching bottom.
.