5 Top-Ranked Tech Stocks That Gained More Than 50% In Q1

As we draw curtains on first-quarter 2019, most of the discussions are centred on the technology sector’s impressive rebound. Notably, the Technology Select Sector SPDR (XLK) has returned 18.2% year to date, outperforming the S&P 500’s rally of 12%.

Technology’s recovery can be attributed to the positive development on the U.S.-China trade-war front, strong demand for AI-based solutions, rapid adoption of cloud and solid IT spending environment. Gartner expects IT spending to be up 3.2% this year to $3.8 trillion, driven by enterprise software, cloud and digital-transformation efforts.

Notably, tech-heavy Nasdaq has gained 15.5% on a year-to-date basis primarily backed by the recovery in technology stocks.

Technology’s Growth Drivers Aplenty

Technology has become ubiquitous. Improvement in Internet speed and penetration globally, rapid adoption of cloud services, and proliferation of Internet of Things (IoT) that is facilitating connected devices and smart homes, are key catalysts. Increasing allegiance to online gaming, music and video-streaming services also deserves a special mention in this regard.

The omnipresence of Internet has aided the companies with a wealth of information provided by their users. Notably, per recent IDC estimates, the global datasphere will grow to 175 zettabytes (that is a trillion gigabytes) by 2025, from 33 zettabytes in 2018. The secular growth trend in data is helping technology companies infuse AI and machine & deep learning into their solutions.

Moreover, sectors like finance, banking, healthcare, education, defense & aerospace, media, among others, are embracing technology rapidly. This is helping the companies in these sectors satisfy the needs of different stakeholders and grow faster. This growing diversification is also boosting revenue and earnings visibility of technology solution providers.

Additionally, the accelerated deployment of 5G technology and faster-than-expected growth in robotics set the stage for more development.

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