U.S. investors have become accustomed to wild weeks of trading down in the canyons of Wall Street, and the week ending Sept. 21 was no exception: Central bankers aggressively cut their rate target, major brokerage houses turned in mixed quarterly reports, oil jumped and the dollar tumbled.
Still, despite that roller coaster of news-making action, the major averages each posted gains on the week and rallied into the weekend.
The best-performing investors who maintain portfolios on Marketocracy.com also sought out sectors they felt proved a safe bet. The verdict? Information technology.
The tech sector is a fan favorite among a lot of professional stock-pickers. In fact, after the U.S. central bankers slashed their rate target on Sept. 18, Standard & Poor's upgraded the Information Technology sector to "overweight.”
"With U.S. economic growth slowing, we believe the information technology sector's 56% international-revenue exposure positions it to outperform, as S&P expects overseas economic momentum to remain robust, especially in emerging markets," said chief investment strategist Sam Stovall. (See: “Pros Pick Techs And Materials After Rate Cut.”)
A top buy among the M100 was analytic software company SPSS. Founded in 1968, Chicago-based SPSS on Sept. 17 released SPSS 16.0, an enhanced version of its flagship statistical software suite of products. SPSS shares have climbed 60% in the last 12 months. With company databases swelling with petabytes of customer data, SPSS has positioned itself as a cutting edge data miner offering clients like Credit Suisse, British Telecom and New York University “predictive analytics.”
M100 players also liked the look of Western Digital, a Lake Forest, Calif.-based manufacturer of hard drives used in computers and other electronic devices. On Sept. 11, the firm pleased the Street after the company raised its first-quarter earnings per share guidance to between 61 cents and 65 cents. Analysts expected a profit of 48 cents per share. In July, the company predicted earnings per share between 43 and 47 cents. The company said it is seeing mounting demand and higher selling prices.
Western Digital also bumped up its first-quarter sales forecast to a range of $1.60 billion to $1.65 billion. Analysts forecast $1.49 billion. The company previously guided $1.45 to $1.50 billion.