As more people work at home remotely to sit out the coronavirus pandemic, the rise in demand for personal computers and other office equipment could help support the technology sector and related ETFs.
According to NPD, there has been a surge in sales for computers and accessories like keyboards, mice, monitors, and laptops, CNBC reports.
Stephen Baker, Vice President, Industry Advisor, Technology & Mobile at NPD, pointed out that productivity hardware is required when working at home, which has caused historic sales increases over the first two weeks of March in categories such as monitors and PCs, as well as computer accessories.
Computer monitor sales alone surged almost two times during the first two weeks of March, while mice and keyboard sales increased 10%, and notebook PCs also saw a 10% rise.
“The shift to working from home has also breathed new life into categories that were in decline,” Baker said.
A Tech Bounce Back
This sudden surge in demand could help technology hardware companies bounce back more quickly. Tech giants like Microsoft have previously warned that it would miss quarterly guidance because of supply chain disruptions, but at the same time, it argued for “strong” demand.
Business to business (B2B) sales were up as well, with NPD pointing out that notebook sales to businesses surged 30% year-over-year during the last week of February and jumped 50% in the first two weeks of March, as companies refurbished employees’ home offices. B2B monitor sales, flat at the start of February, was 40% higher during the first two weeks of March.
ETF investors who want to capitalize on this shift in consumer trends can look to something like the targeted SPDR S&P Technology Hardware ETF (NYSEArca: XTH), which includes a 38.7% tilt toward electronic equipment & instruments, 34.0% tech hardware storage & peripherals and 27.3% electronic components. Alternatively, an investor can still look to broad technology sector plays, like the Technology Select Sector SPDR Fund (XLK), which includes 33.8% software, 22.0% IT services, 20.5% tech hardware storage & peripherals, 17.8% semiconductors & equipment, 3.9% communication equipment, and 2.0% electronic equipment instruments.
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