Despite persistent inflation concerns and rising bond yields, technology stocks outperformed broad markets this week. The Nasdaq’s “Magnificent Seven” cohort gained an average of 3.5%, driven by strong corporate results and upbeat guidance.
Apple reported record services revenue, while Google’s Alphabet beat on both ad-sales growth and cloud computing margins. Meanwhile, Microsoft announced a $15 billion share-repurchase authorization, signaling confidence in its long-term cash flows.
IGS Investment’s Technology Sector Lead, Sophia Martinez, noted:
“These companies continue to innovate and deliver recurring revenue streams. Their robust balance sheets allow them to absorb cost pressures and maintain attractive growth profiles, even as central banks tighten.”
Semiconductor stocks also climbed on positive commentary from Taiwan Semiconductor CEO Mark Liu, who forecast improving chip demand in the second half of the year. However, small-cap tech names lagged, suggesting investors preferred larger franchises for safety.
With earnings season in full swing, IGS Investment recommends a barbell approach: overweight top-tier mega-caps while selectively adding high-growth mid-caps with proven profitability.