Technology investors on Wall Street are opening champagne against the backdrop of the banking incinerator there. This is how, at least, the boom in shares of “smart” companies in the overseas market acts with some hyperbole. The biggest tech brands in the Fang+ index, for example, have earned investors an average of 10 percent since the US banking crisis escalated in almost a week. The growth technological wilderness is primarily a result of the diversion of investor money away from bank stocks, but it also represents an interesting choice for the stock market because of potentially more accommodative monetary policy.

“Expectations were substantially lowered during the banking crisis
rise in interest rates. It is technology companies that are among the most indebted, so the expected development of rates is a living water for them,” says XTB expert Jiří Tyleček. It also performed solidly during the week versus the substantially broader Nasdaq Fang+ index. It earned over five percent in the week, or roughly five times as much as the stock market as a whole. “The technology sector is promising for the long term, and now it has received another boost when the insurance system pays all these companies full deposits

in the fallen SVB, although 95 percent of them were uninsured,” recalls Petr Bartoň, economist at Natland.
Among the well-known names in the sector, money has gone back to shipping firm Bolt, whose shares have undervalued by about 18 per cent over the past week. Chip maker AMD also fared well with nearly seventeen percent. “Companies like AMD and NVidia are benefiting from the supply of cryptocurrency miners, which are currently experiencing a rebirth,” reminds DRFG economist Martin Slaný of the specific growth motive of the chipmakers.

About 11 percent were collected by shareholders of Alphabet and Amazon. The growth king of the big names has become Meta, whose shares are at their most expensive since April, after nearly 14 percent weekly growth.
“Their relatively minor vulnerability to possible economic problems that may arise from banking turbulence can also play a role in the growth of the sector,” believes Patria Finance economist Tomáš Vlk.

The Fang+ index has earned investors more than 27 percent this year, nine times more than Wall Street as a whole, while the Nasdaq technology index has risen 13 percent since the beginning of the year. This year's peak was reached by technologies in early February, then gradually began to lose until the banking crisis escalated, largely under the impression of a tighter struggle by central banks with inflation and thus potentially more expensive financing.

In general, however, this year the influx of money into the sector has also been helped by non-violent “advertising” in the form of mass popularization of artificial intelligence. “Especially in recent weeks, technology stocks have been riding a wave of interest in ChatGPT,” Tyleček said. At the same time, the threat of more expensive financing was behind last year's slump in big tech brands, when the aforementioned Fang+ index, for example, lost almost a third.

Technology stocks reached their absolute peak in the fall of 2021, when, for example, the Nasdaq index was still about a third higher than it is today. “Technology stocks are no longer cheap after this year's growth,” Irene Tunkel, analyst at BCA Research, told Market Insider. Technology stocks in the S&P index are currently trading at 22 times expected earnings per share, outperforming the entire market.

Source: E15

https://www.e15.cz/byznys/burzy-a-trhy/potize-bank-rozjely-boom - technologicych-shares-investor-takes-tens-of-thesobek-market-1397164

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