Benzinga - by Surbhi Jain, .
Over the past six months, the tech sector has been trailing behind communications services.
What Happened: The SPDR Select Sector Fund – Technology (NYSE:XLK), which tracks the tech sector, posted a respectable +17.94% gain (as of June 25).
But it wasn't enough to outpace the +18.37% surge in the Communication Services Select Sector SPDR Fund ETF (NYSE:XLC), which follows communications services.
The tech sector witnessed astronomical gains from two companies in particular:
- Super Micro Computer Inc. (NASDAQ:SMCI) rocketed +191.01% to $289.72; it only holds a 0.43% weight in the XLK ETF.
- Nvidia Corp (NASDAQ:NVDA) wasn't far behind, soaring +158.22%. With a 20.73% index weight, Nvidia's +158.22% climb to $48.83 is monumental yet insufficient to lift the entire sector.
Other notable tech performers include:
- Micron Technology Inc (NASDAQ:MU), which surged +63.16% to $86.49.
- CrowdStrike Holdings, Inc. (NASDAQ:CRWD), which rose +51.30% to $255.63.
- First Solar Inc (NASDAQ:FSLR), which increased +50.68% to $170.39.
While tech had its stars, communication services had a broader rally. Meta Platforms Inc. (NASDAQ:META), Netflix Inc. (NASDAQ:NFLX), and Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) drove the XLC ETF to outperform.
- META: Leading the charge with a +44.49% rise to $353.39, Meta’s dominance (22.74% index weight) is clear.
- NFLX: Up +38.14% to $486.76, Netflix’s strong showing was a significant boost.
- GOOGL and GOOG: Both Alphabet stocks climbed around +30%, closing at $141.49 and $142.72, respectively.
Investors should note that even with tech titans like Nvidia and Super Micro Computer making waves, sector-wide trends and diversified gains in other sectors can shift the balance.
As tech titans continue to battle, the communications services sector's broader strength underscores the importance of a diversified portfolio. Watching these sectors unfold will be key for strategizing the next move in an ever-evolving market landscape.
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