The graphic below summarizes the performance of the six different industries that comprise the Technology sector and shows each one’s weighting in the S&P 500, how the largest stocks in each industry have performed YTD, how each one has performed over various time frames, and then where each industry is currently trading with respect to its 52-week range. In each line chart on the right, the circle shows where the industry is trading now relative to its 52-week range, while the tail shows where the industry was trading as of 9/20/18 when the S&P 500 peaked.
For the Technolgy sector, performance has been on fire this year. All six of the sector’s industries are outperforming the S&P 500 YTD with gains of over 20%. MTD performance is nearly as impressive with all but two industries outperforming. So far in April, both Electronic Equipment and Semis have already seen gains of more than twice the S&P 500. In the Electronic Equipment industry, Amphenol’s (APH) 27% YTD gain has been a key driver, while in the semis Nvidia (NVDA) is up 44% YTD! The most impressive performance of them all, though, has to be Apple (AAPL). 26% may not sound like much compared to NVDA’s 44% gain, but when you are the largest company in the world, 26% translates to an increase of $131 billion in market cap!
Finally, with such big gains for the industries in the sector YTD, most of them are not only above the level they traded at when the S&P 500 peaked in September, but they are also at new highs. The only one that has yet to trade above the level it was at in September is Technology Hardware, which has been weighed down by AAPL which despite its big gain this year is still down 10% from where it was trading on 9/20. The one drawback to Tech’s recent strength, though, is as the charts below illustrate, many of these industries have become extremely extended on a short term basis, which could make them more susceptible to at least a pause in their rallies. Like what you see? Start a two-week free trial to Bespoke Premium to access our insightful market research and much more.