Back in March and early April I wrote about what I believed was the beginnings of a rotation into technology names that to date have lagged during the YTD rally. Specifically large cap tech names such as INTC, MSFT, AAPL, CSCO.
During the last few days that rotation has gained some traction as we have seen a liftoff in shares of INTC which is up 11% in a month. MSFT has followed nicely with a 15% gain in the same timeframe.
I continue to see upside to select names in the Tech area, AAPL, CSCO are two of my favorites at these levels. QCOM is a buy in the $61- $62 area after an excellent earnings report. The stock shed 5% presenting buyers with an opportunity to get involved in a strong long term growth story. I recently initiated a small position in FB and will monitor that situation to possibly add after FB reports tomorrow 5/1.
If this rotation continues to take hold and spread it will bode well for the markets to continue on their march to new highs. Tech has to be involved if the markets continue higher.
In a effort to keep your holdings "fair and balanced" I continue to recommend writing upside calls on any positions that are stretched and rotate some money out of situations with big gains. I anticipate any pull backs will be contained and should be used to pick up bargains that are out there and I expect to employ some capital here in stocks with solid fundamentals that have lagged YTD.
Additional disclosure: Stocks for Income means just that at Stocks4Income.com Dividend Growth Portfolio up over 15% with a yield of 4% YTD.