Although the major stock market indexes have witnessed a correction of sorts over the past week on concerns about the resurgence of COVID-19 cases and high inflation, the tech industry is equipped to brave most market challenges thanks to a continuing digital transformation across industries and consistent product and services innovation. So, we believe it could be wise to bet on quality large-cap tech stocks Broadcom (NASDAQ:AVGO), SAP (SAP), and QUALCOMM (QCOM). They are positioned to hold steady amid the short-term market volatility and generate big returns over the long run. Let’s discuss.After hitting all-time highs, the major stock market indexes saw a mild correction over the past week, reflecting investors’ concerns over the spread of the Delta variant of coronavirus and high inflation. The tech-heavy Nasdaq fell nearly 3% over the past week to close yesterday’s trading session at 14,274.98.
Because the market is expected to remain volatile, we think it could be wise to invest in quality large-cap tech stocks. That’s because large-cap stocks are known for withstanding market volatility and delivering stable returns, and the technology industry is showing much promise with the ongoing digital transformation across several industries. Because the demand for the internet of things (IoT) and artificial intelligence (AI)-based solutions, among other advanced technologies, is expected to continue rising, the tech industry is well-positioned to grow. According to Statista, there were 4.66 billion active internet users worldwide as of January 2021, representing 59.5% of the global population. This number is expected to rise further, which could lead to increasing demand for advanced technological solutions.
So, we think it could be wise to bet on fundamentally sound large-cap tech stocks Broadcom Inc. (AVGO), SAP SE (DE:SAPG) (SAP), and QUALCOMM (QCOM) to capitalize on the industry tailwinds. Our POWR Ratings system has rated each of these stocks as Strong Buy.