Looking Beyond Tech for Growth

By David Bogoslaw
businessweek.com

While there are still reasons to be wary of how far equity prices have come since March, those who are certain the rally can be sustained are trying to position their portfolios for the biggest possible gains in the months ahead, and that may mean shifting away from technology stocks.

Technology has been the most-loved sector since the stock market hit its low in March, evidenced by the fact that the 67.4% gain in the Nasdaq composite index since then has far outpaced the 57% rise in the Standard & Poor’s 500-stock index and the 49% increase in the Dow Jones industrial average. The reason that tech stocks didn’t drop as sharply as financials or industrials when the broader market cratered supposedly is because businesses were expected to continue to spend on technology products to improve efficiency even as they slashed their workforces and cut other costs.

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