Don't buy the dip in tech stocks: BofA

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Don't buy the dip in tech stocks: BofA

Bank of America analysts urged caution when it comes to buying the dip in tech stocks, warning that despite the recent selloff, the sector remains risky.

The bank emphasizes that tech stocks are"cyclical, not secular," meaning they are closely tied to economic fluctuations. Elsewhere, BofA's broader outlook highlights volatility in the short, medium, and long term. The bank's"Regime Indicator" is said to have recently shifted from an"Upturn " to a"Downturn " signal, reinforcing the cautious stance on growth-driven sectors like tech.Meanwhile, in contrast to tech, BofA is more positive on defensive sectors such as Utilities and Real Estate, which they note offer more stable dividends and inflation protection.

Overall,"Don't buy the Tech dip," argues BofA, as growth stocks face continued headwinds, and defensive sectors offer a more stable opportunity.Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors.

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