Even though the tech sector is volatile due to investors' sector rotation and concerns over rising inflation, many tech stocks are well positioned to gain from an increasing demand for advanced tech solutions from almost all industries. So, we think that Investors who are seeking to capitalize on the industry’s impressive future growth—ignoring the short-term price fluctuations—could bet on large-cap stocks Apple (AAPL), Amazon (AMZN), and QUALCOMM (QCOM). Wall Street analysts expect these stocks to deliver solid returns in the near term. Read on.After exponential gains last year thanks to the COVID-19 pandemic-driven increased dependence on tech solutions since the beginning of the year, the technology industry has been witnessing high volatility due to investors’ rotation out of the sector and into cyclical stocks to capitalize on the recovering economy and due to fears of rising inflation.
Nevertheless, the tech industry is well positioned to gain due to rapid adoption of advanced technologies such as artificial intelligence (AI), Internet of Things (IoT), augmented reality (AR) and 5g network. The expected continuation of remote working (a key part of organizations’ hybrid working models) should also lead to an increase in demand for advanced software, cybersecurity solutions and cloud computing. Indeed, the tech industry is expected to hit a$5 trillion market value by year’s end.
The tech-heavy Nasdaq Composite’s 7% returns over the past month reflect investors’ renewed interest in the tech space. Given the industry’s promising prospects, analysts are highly optimistic about the near-term performance of large-cap tech stocks Apple Inc. (NASDAQ:AAPL), Amazon.com, Inc. (NASDAQ:AMZN), and QUALCOMM Incorporated (NASDAQ:QCOM). Given these companies’ market dominance, we think their stocks are well positioned to withstand any short-term market volatility and deliver solid returns.