3 Tech Stocks to Buy as Fed Pivot Odds Soar on Peak Inflation Bets
The U.S. stock market looks set to extend its rally through the end of the year, after Wall Street cheered fresh inflation data that supported the view that the Federal Reserve may be done raising interest rates.
Source: Investing.com
Expectations of the Fed cutting rates next year also rose following the soft CPI report. As of Wednesday morning, U.S. rate futures priced in an 80% chance of a rate cut in May, compared with 45% on Monday, according to the Investing.com Fed Monitor Tool.
The tech-heavy Nasdaq has been the top performer of the three major U.S. indexes by a wide margin so far in 2023, surging 34.7% year-to-date. That compares to an increase of 17.1% for the benchmark S&P 500 over the same time span and a 5.1% gain for the blue-chip Dow Jones Industrial Average.
The ongoing rally has been fueled by shares of the mega-cap tech companies, with Nvidia (NASDAQ:NVDA), and Meta Platforms (NASDAQ:META) both posting triple-digit gains thus far, while Tesla (NASDAQ:TSLA), Amazon (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT), Alphabet (NASDAQ:GOOGL), and Apple (NASDAQ:AAPL) are also up solidly on the year.
Taking that into consideration, I recommend buying shares of DraftKings, CrowdStrike, and Datadog amid increasing odds that the Fed is done hiking interest rates and will pivot to easing monetary policy in 2024.
Receding inflation fears and growing optimism that the Fed is all done raising rates will continue to power shares of DraftKings (NASDAQ:DKNG), which has seen its growth story gather momentum lately thanks to an improving fundamental outlook.
DKNG stock ended Tuesday’s session at a fresh 52-week high of $37.03, earning the Boston, Massachusetts-based sportsbook operator a valuation of $17.2 billion.
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