S&P Still Bullish on Tech

S&P reiterated their bullishness on information technology, in today's Morning Brief. They have been bullish on technology since the beginning of the year when they expected tech to outperform. Their analysis showed that technology usually outperforms in the 2nd year of a bull market. One way to play tech is through a mutual fund. I recommended (FBSOX) – Fidelity Select IT Services, Sector Fund, in an article here at Benzinga in February and it's up around 11% since then, about 6.56% year to date. I own shares in the fund.

http://www.benzinga.com/trading-ideas/long-ideas/139394/fbsox-%E2%80%93-...

Here are some quotes from the S&P report:

“Even with a series of weaker-than-expected reports raising concern that the U.S. economy is sliding back into recession, there are several economic outposts located far enough from the housing sector to be generating growth on their own. One such region is information technology.

Information technology is one of just two sectors that Standard & Poor's Equity Strategy recommends investors overweight in their portfolios (the other is consumer staples), due to the start of a new replacement cycle for personal computers, healthy balance sheets, strong exposure to growing emerging markets, and cost cuts implemented during the recession. S&P Equity Research believes IT companies will report a 49% gain in operating income per share during 2010. Also, shares of many IT companies are still trading near their lowest price in the past decade. Indeed, valuations appear so compelling that several IT companies have started to make acquisitions recently; Dell and Hewlett-Packard even got into a bidding war over data storage company 3PAR.”