Technology stocks have been particularly vulnerable at the start of the year. Despite the current market weakness, we believe technology will continue to be a principal driver of change in today’s increasingly digital global economy, and a key determinant of whether a company will succeed in a rapidly changing environment. Our long-term outlook for the technology sector remains positive and here is why.
Technology enables changes across every industry
Much of the recent volatility for tech stocks has been driven by the US Federal Reserve switching to a more hawkish stance, indicating earlier rate hikes, and removing all reference to the word “transitory” when it came to discussing inflation. As a result, investors panicked with one of the sharpest rotations on record, away from growth stocks in favour of value and defensive stocks.