Author: NN Investment Partners
The performance of the US equity market is to a large extent driven by the IT sector. The rise of the tech sector represents 53% of the total rise in US market cap year-to-date.
We still feel comfortable with our preference for Eurozone over US equities. Despite many investors are overweight Eurozone equities nowadays, we feel they are still in a sweet spot. Moreover, the US equity market rally is based on a narrowing number of stocks, as performance is to a large extent driven by the IT sector. Despite its strong performance, the technology sector’s valuation is still far away from the late 1990s tech bubble levels.