QQQ includes a large 10.7% tilt toward AAPL, along with 8.4% MSFT and 4.9% FB. XLK also holds a 13.4% position in AAPL, 10.6% MSFT and 6.2% FB.
“I think what you are seeing is people moving out of names that have been winners in the past couple of years and from companies that have predictable growth such as Facebook, Alphabet and Apple,” Michael Scanlon, managing director of Manulife Asset Management, told Reuters.
Ever since Donald Trump won the presidential elections, technology stocks have barely moved, returning a paltry 0.6%.
Furthermore, President-elect Trump’s fiscal policies could bolster growth and fuel inflationary pressures, which has prompted speculation of Federal Reserve interest rate hikes and a strengthening U.S. dollar. Consequently, with an appreciating USD, large multi-national companies could experience lower profits and sales in overseas markets, and technology companies in the S&P 500 receive almost 60% of their revenue outside the U.S., the Seattle Times reports.
For more information on the tech sector, visit our technology category.