With the Fed hinting at keeping interest rates near zero until late 2023, investors’ interest in tech stocks has been returning. Against this backdrop, it could be wise to bet on quality tech stocks NXP Semiconductors (NASDAQ:NXPI) and Corning (GLW), which we expect to continue gaining in the coming months. Read on.While high-growth tech stocks dominated the market last year, they failed to maintain their strength earlier this year as investors rotated out of expensive tech stocks on concerns over inflation and to capitalize on the recovering economy by betting on cyclical stocks. However, this sentiment seems to be changing. The tech-heavy Nasdaq Composite hit an intraday record high on June 22 following Federal Reserve Chair Jerome Powell’s reiteration that he believes inflation pressures will be temporary. Investors’ increasing interest in tech stocks is evident in the Technology Select Sector SPDR Fund’s (XLK) 6.2% gains over the past month compared to the SPDR S&P 500 Trust ETF’s (SPY) 2% returns.
The technology sector is well-positioned to grow as businesses, broadly, continue to digitize their operations. According to Statista, spending on IT services is expected to amount to more than $1.1 trillion in 2021.
So, we think it’s wise to now bet on NXP Semiconductors N.V. (NXPI) and Corning Incorporated (NYSE:GLW). These names possess solid growth attributes and are expected to generate significant returns in the coming months.