Can Tech Lead Stocks Higher In The Second Half Of 2025?
2025-07-17 21:10:06
Main Idea
The article examines whether the tech sector can continue to drive stock market gains in the second half of 2025, highlighting its historical performance and future earnings growth potential.
Key Points
1. The tech sector had a strong Q2 2025, with the Nasdaq 100 up 17.6% and the S&P 500 up 10.6%, driven by tech's significant weighting in these indices.
2. Tech stocks have historically outperformed, with the Nasdaq 100 returning 485% from 2014 to 2024 compared to the S&P 500's 218% gain.
3. Despite recent underperformance (Q3 2024 to Q1 2025), tech is expected to see 21% earnings growth in 2025 and 18% in 2026, second only to energy.
4. Semiconductor leadership and AI are seen as key catalysts for tech's potential rebound, with the Magnificent 7 (e.g., Nvidia, Microsoft, Meta) playing a crucial role.
5. Tech's performance is not guaranteed, as it has underperformed during past market downturns like the 2025 'tariff tantrum' and 2020 COVID selloff.
Description
Tech stocks struggled over the prior quarters, but came booming back to life in Q2. Can this group lead US stocks higher into year-end?
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