Login Dark

Dip buyers flock to tech funds after earnings spark rout - Yahoo Finance

Author: Yahoo Finance

Source: https://finance.yahoo.com/news/dip-buyers-flock-tech-funds-143242698.html

Image of Dip buyers flock to tech funds after earnings spark rout - Yahoo Finance

By Bansari Mayur KamdarOct 27 (Reuters) - Bargain hunting drove investors to exchange-traded funds (ETFs) tracking technology companies after shares fell sharply on mixed earnings from heavyweights.The iShares US Technology ETF, which has $11.2 billion in assets with Apple and Microsoft among its top holdings, saw net inflows of $694 million in the week ended Oct.25, according to Lipper data, its best performance in over a year."Investors want large-cap tech exposure – whether that's because they can handle higher rates better or simply because they're more comfortable with those names in a really challenging macro environment," said Todd Sohn, ETF and technical strategist at Strategas Securities.The fund's price fell nearly 4% in the week, as mixed results from megacaps like Alphabet weighed on the sector.Despite potential short-term challenges, investors are starting to turn attention to 2024 where tech is expected to outperform, said Todd Rosenbluth, research head at VettaFi.Tech-heavy Nasdaq gained 20% since the start of the year, supported by rallies in the "Magnificent 7" tech stocks on optimism around artificial intelligence.However, worries about higher-for-longer interest rates have stalled the momentum and set the benchmark on course for monthly losses.Tech funds saw inflows of $2 billion in the week to Wednesday, their largest in eight weeks, according to BofA Global Research, which it attributed to investors "buying the dip".The $14 billion ProShares UltraPro QQQ posted net weekly inflows of $68.15 million, even as the price of the fund fell 9.5%."TQQQ is experiencing a surge in net flows as more aggressive retail traders seek to make big gains on hopes of a quick rebound," Vanda Research's analysts said in a note.The $46.5 billion Technology Select Sector SPDR Fund and the $9 billion VanEck Semiconductor ETF posted net inflows of $205.7 million and $280.6 million, respectively, for the week.(Reporting by Bansari Mayur Kamdar in Bengaluru; Editing by Shweta Agarwal)

Subscribe To Our NewsLetter