A widely-held assumption about rallying tech stocks is deceiving as smaller names lag, analyst Nick

A widely-held assumption about rallying tech stocks is deceiving as smaller names lag, analyst Nick

show chapters This widely-held assumption on tech rally is misleading, analyst Nick Colas finds 4:09 PM ET Fri, 14 Sept 2018 | 01:35 Come Monday, the tech-heavy Nasdaq will try to kick-off its second positive week in a row. But its poised to do so without small cap tech and Chinese internet companies. According to veteran market watcher Nicholas Colas, much of Wall Street is mistakenly assuming that the technology sectors big surge is broad-based. Its largely a large cap phenomenon, the DataTrek Research co-founder said Friday on CNBCs Trading Nation . The Nasdaq is now up almost 25 percent over the past 52-weeks, while the broader S&P 500 is up 16 percent in that same period. Yet Colas noted that only a handful of super-sized tech companies such as Amazon and Apple have been instrumental in pushing the group higher. Large cap tech is up 17 percent. Its roughly half of the S&Ps gains [year-to-date.] You can throw in Amazon and you get 70 percent of the S&Ps gains for the year, he said. But, for example, in small cap, the S&P 600 , tech is actually underperforming. While U.S. mega internet stocks are grabbing big gains, Colas pointed out Chinas equivalents, such as Alibaba and Baidu , have been under pressure. Looking internationally, for example, the tech narrative even falls apart there, he said. China has almost as vibrant a market for internet and tech as we do, names there are down an average of 23 percent year-to-date. Even though Colas detects pockets of pain in tech, he predicts momentum will continue to drive large U.S. cap tech names higher this year. Hes not worried about valuations due to the bullishness of the economic cycle. Were still positive on large cap tech names , Colas said. For the balance of the year, momentum seems very strong. Vote Vote to see results Total Votes: Not a Scientific Survey. Results may not total 100% due to rounding. show chapters Techs role in the record rally may be smaller than you think, according to Nick Colas 4:08 PM ET Fri, 14 Sept 2018 | 03:24 Disclaimer
A widely-held assumption about rallying tech stocks is deceiving as smaller names lag, analyst Nick