As yields fall, some investors are flocking to rate-sensitive technology stocks

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A sharp decline in bonds yields is providing the much needed relief for tech stocks that have come under pressure from rising rates.

A sharp decline in bonds yields is providing much needed relief for big tech stocks that were under pressure in recent weeks. Yields fell drastically Monday as the collapse of Silicon Valley Bank wreaked havoc on the broader banking sector and pushed investors into safe haven assets. The move brought the 2-year Treasury yield to its biggest 3-day decline since 1987 , while the yield on the 10-year Treasury note hit its lowest level since February. Yields rebounded Tuesday.

mountain Microsoft pops 3% as bond yields decline Combined with increasing disinflation expectations and backstop assurances for SVB depositors with money at the bank, EMJ Capital's Eric Jackson sees "extremely bullish tailwinds" for the sector going forward.

mountain Meta Platforms shares this year Paul Meeks also views the rise in technology stocks as a short-lived relief rally following the selloff in the sector in recent weeks. While the potential for moderating interest rate hikes means good news for tech and aggressive growth, the broader macro picture remains unchanged and skewed to the downside, said the portfolio manager at Independent Solutions Wealth Management.

 

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