Investors have sought shelter from the turmoil of the war in Iran in US tech stocks, in a flight away from sectors seen as vulnerable to an energy shock.
Technology has been the best-performing S&P 500 sector since the conflict began, rising 1.5 per cent from the market close on February 27 — the eve of the US-Israeli bombardment — despite every other sector in the index dropping, as global investors put aside fears of the disruption caused by AI and seek refuge in the stellar profits of Silicon Valley’s Magnificent Seven tech giants.
“I often hear from clients that the Magnificent Seven are like a safety asset,” said Christian Mueller-Glissmann, head of asset allocation research at Goldman Sachs, adding that the big tech companies were “like countries in terms of the size of their balance sheets and their [competitive] moats”.