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18.05.2023 04:02 PM
Top US tech firms soar by 30% this year

Major US tech firms have posted significant gains this year. Notably, Apple, Alphabet, Amazon, and Microsoft have surged by over 30% since the beginning of the year, while shares of Meta, the parent company of Facebook, have skyrocketed more than 101%. Meanwhile, the Dow Jones Industrial Average has increased by less than 1%. A Wall Street manager recently suggested that given the economic backdrop, investors' bets on these companies' growth may not pay off, and market positioning, although rational under the circumstances, could be short-sighted.

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As the economist notes, the gap between the tech-heavy NASDAQ index and the broader S&P 500 index has widened after the earnings season: 75% of tech companies outperformed expectations compared to a rather mixed picture in other sectors and generally gloomy economic data.

Nevertheless, investors continue to bet on a further rally. This is because central banks will soon have to start stimulating their economies again and wind down their aggressive monetary tightening programs.

Premarket

Shares of retail giant Walmart rose by over 1.5% in premarket trading after the company raised its annual forecast and reported nearly an 8% sales increase in the first quarter, highlighting the strength of its large grocery business. Walmart also reported higher-than-expected adjusted earnings.

Shares of video game maker Take-Two jumped by 14% following news of higher-than-expected revenue. Although Take-Two Interactive shared a weaker-than-expected forecast, it indicated a strong gaming plan that could fuel the company's growth in the future.

Cisco Systems shares dropped by 4% after the company reported a 23% decrease in orders.

Shares of Chinese e-commerce company Alibaba slipped 1% in pre-market trading following mixed results for the last quarter. The company's revenue fell short of expectations. It also announced plans to list its cloud division.

Synopsys shares added 2% after the company reported higher-than-expected quarterly results. The software developer also shared a more robust revenue growth forecast for the entire year.

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Shares of Sony have climbed by nearly 4% following the company's announcement that it will begin evaluating the spin-off of its financial services business. Sony plans to list shares of Sony Financial Group in roughly two to three years while retaining approximately 20% ownership of the business.

As for the S&P 500 index, demand remains robust, and bulls have every chance to continue the current trend. Bulls need to keep the price above $4,150, from where they may drag the index to $4,184. In addition, bulls should control the level of $4,208, which will reinforce a new bull market. If the index declines amid weak US statistics, bulls should protect $4,150 and $4,116. Breaking through this level, the trading instrument may drop to $4,091 and $4,064.

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