The U.S. tech companies have witnessed a mammoth growth over the last decade. The coronavirus pandemic has added more fuel to its growth and the tech sector valuations soar above $9.1 trillion with Apple leading the pack.

The tech industry has been the biggest beneficiary of the consumer shift during the coronavirus pandemic crisis. The U.S. tech stocks have been soaring high with Apple Inc (NASDAQ: AAPL) becoming the first tech company to hit a $2 trillion market cap.

The latest report from Bank of America Global Research shows that the surging valuations of U.S. tech stocks have ultimately surpassed the total valuations of the entire European stock market for the first time in history. The U.S. tech sector market valuations currently stand at a whopping $9.1 trillion. On the other hand, the European market combining Switzerland and U.K. is valued at $8.9 trillion.

The rise of the U.S. tech companies over the last decade has given a formidable boost to the sector. Just for reference, Bank of America notes that the European market was four times the U.S. tech sector in 2007. The mega-tech companies in the U.S. have witnessed a mammoth growth in 2020.

The five big giants of the U.S. tech sector include Apple, Amazon.com Inc (NASDAQ: AMZN), Microsoft Corporation (NASDAQ: MSFT), Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL), and Facebook Inc (NASDAQ: FB). In January 2020, these five giants accounted for a total of 17.5% of the S&P 500 index. The COVID-19 pandemic has turned tables in favor of them. With more people working from home, tech companies have seen a massive demand in their products and services. Now, these five companies alone account for more than 20% of the S&P 500.

Rising Dominance of U.S. Tech Stocks and Road Ahead

Over the last decade, the tech industry has emerged as the top-performing sector in the market. The traditional oil and gas sector which once dominated Wall Street has been left far-far behind in terms of valuations. The COVID-19 economic crisis has further pushed the oil industry spiraling downwards and travel comes to a halt.

On the flip side, it has served as a boon for the tech industry further widening the gap between the two industries. In the tech space, Cupertino-based tech giant Apple leads the pack with valuations at $2.13 trillion. The Apple stock has surged over 65% year-to-date.

Amazon Inc has also been another giant in the game. The Amazon stock has surged a whopping 70% year-to-date with the company valuations standing at $1.70 trillion. This has also made company CEO Jeff Bezos the richest and the first person to have over $200 billion net worth.

Other software giants like Microsoft, Facebook, and Google continue to deliver stellar results during the pandemic season with their stocks surging anywhere between 20-40%.

However, a few market analysts have suggested signs of caution for new investors. Some strategists have warned about the antitrust measures which can hit the companies’ success. Besides, they also think that the sector remains overcrowded for the time being.

Despite the stock markets soaring high, the U.S. economy doesn’t look in a good shape for now. Economists are fearing the concerns of rising inflation and a possible double-dip economic recession.

Business News, Indices, Market News, News, Stocks

Bhushan Akolkar

Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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