Best Tech Stocks To Buy Now
Wealth Insight|December 2022
Profit from the opportunity to buy them at their lows
Karthik Anand Vijay and Udhayaprakash
Best Tech Stocks To Buy Now

After a spectacular run between March 2020 and January 2022, the technology sector across the globe has been sent into a maelstrom. The BSE IT index has fallen 22.2 per cent in 2022 (as of November 11, 2022). On the other hand, the tech-heavy Nasdaq 100 is down 28.4 per cent. As the readers of 'Wealth Insight' already know, the worst of times in the stock market are also the best of opportunities. Hence, we decided to do this cover feature to bring to you the best stocks to buy now. But first, let's understand what has caused this fall.

The story of the rise and the fall

When the pandemic hit the world and everything came to a standstill, governments across the world announced huge stimulus packages in order to revive the economic engine. Central banks put in place a loose monetary policy to drive demand and to ensure that individuals and companies don't fumble. This led to a significant bull run in equity markets across the world. The BSE IT index rallied from its March 2020 low of 10,937 to a peak of 38,713 in January 2022. That is a 254 per cent return (i.e., more than tripling) in just under two years! Similarly, in the US, the Nasdaq 100 more than doubled from its March 2020 low of 6,772 to 16,607 in December 2021.

However, as a consequence of the mega stimulus to support the economy, inflation started going up. Developed economies, where inflation had all but vanished, started reporting high inflation. To counter that, central banks around the world started to raise interest rates. In general, high rates are negative for businesses as they increase the cost of capital for them. So, as the rates started to go up, the markets began to fall. Tech stocks, which had seen a rally on steroids, were also the ones to see the deepest correction.

This story is from the December 2022 edition of Wealth Insight.

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This story is from the December 2022 edition of Wealth Insight.

Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 8,500+ magazines and newspapers.