Tech stocks close out first six-week rally since January 2020

Tech stocks have yet to fully rebound from a miserable 2022, but they’re rewarding investors who saw the sell-off as too intense.

The Nasdaq Composite rose 2% this week, capping the sixth consecutive weekly rise for the technology-heavy index. It is the longest period since January 2020, before the Covid-19 pandemic hit the United States

Stocks across the board got a big boost on Friday after the strong May jobs report and the Senate’s approval of the debt ceiling bill Thursday night, allowing the United States to avoid default. President Joe Biden must still sign the bill.

While last week’s gains were paid off nvidia Earnings Report and Growing Optimism About Demand for Technologies Powering AI Burdens This week we didn’t see any major news in the corporate group. But there was a constant upward momentum.

Among the Nasdaq’s most valuable companies, Tesla took the lead, up 11% for the week. Shares of the electric car maker are now up 74% for the year after losing nearly two-thirds of their value in 2022.

Tesla and Nvidia, which have jumped 169% this year, helped lift the Nasdaq by 27% in 2023, far outperforming the S&P 500 and Dow Jones Industrial Average. After peaking in late 2021, the Nasdaq fell 33% last year, its biggest drop since the financial crisis, due to concerns surrounding inflation and rising interest rates. The index still lags its all-time high by about 18%.

“I’m focused on big tech here and semiconductors as well,” Danielle Shay, vice president of options at Simpler Trading, said in an interview on CNBC’s “The Exchange” Friday. “The AI ​​business has been absolutely phenomenal.”

In the technology cloud software corner, some earnings reports still provide a boost.

MongoDB, a cloud database developer, jumped 33% for the week. On Thursday, the company reported profits and revenue that beat analyst estimates and raised guidance for fiscal 2024.

On the MongoDB earnings call, CEO Dev Ittycheria said his company’s products are seeing increased use as customers look for efficiencies and cost reductions.

“Clients obviously continue to scrutinize their technology investments and have to decide what technologies are must-haves, versus just something nice,” he said.

Cyber ​​Security Vendor The guard is one and software developer pagerduty I tested the other side of the equation.

SentinelOne fell 35% for the week after the company lowered its guidance and announced layoffs. Large customers are using technology less, and because of the current macro environment, we expect these lower usage and consumption trends to continue.

PagerDuty is down 14% this week. Chief Financial Officer Howard Wilson said the provider of technology that helps IT departments respond to incidents cut its outlook for the year “in anticipation of continued stress” in small and medium-sized businesses.

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