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Tech sector pressures could be 'good news,' strategist says

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The tech sector (XLK) is under pressure as investors await Nvidia's (NVDA) highly anticipated second quarter results. Concerns are mounting over whether the semiconductor giant can meet Wall Street's lofty expectations. Principal Asset Management chief global strategist Seema Shah joins Morning Brief to discuss the market outlook and what future interest rate cuts could mean for the tech sector.
Shah notes that the second quarter earnings season has shown that the strong earnings performance, once concentrated within Big Tech, has "started to broaden out to other sectors." She interprets this as a reflection of healthy economic growth and "a healthy improvement in the market," adding that "this is good news."
"What we generally want to see, though, for a healthy equity market, is that you're seeing performance that is spread out across a number of sectors rather than just being driven... by the Magnificent Seven or a couple more tech companies," Shah explains.
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Shah notes that the second quarter earnings season has shown that the strong earnings performance, once concentrated within Big Tech, has "started to broaden out to other sectors." She interprets this as a reflection of healthy economic growth and "a healthy improvement in the market," adding that "this is good news."
"What we generally want to see, though, for a healthy equity market, is that you're seeing performance that is spread out across a number of sectors rather than just being driven... by the Magnificent Seven or a couple more tech companies," Shah explains.
#news #youtube #stockmarket
About Yahoo Finance:
Yahoo Finance provides free stock ticker data, up-to-date news, portfolio management resources, comprehensive market data, advanced tools, and more information to help you manage your financial life.
- Follow Yahoo Finance on social:
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