U.S. Technology Stocks Stand to Benefit From Ties to TIPS
Technology stocks are poised to gain support from relatively stable yields for U.S. inflation-indexed debt, according to Andrew Garthwaite, a global strategist at Credit Auisse Group AG. He compared a relative-strength gauge for the group with the tied on10-year Treasury Inflation Protected Securities, or TIPS, in a report Thursday. The S&P 500 Information Technology Index’s ratio to the benchmark gauge of U.S. equities set this year’s low in March, and then climbed as demand for the debt caused yields to fall. “We do not expect a meaningful rise in the TIPS yield,” Garthwaite wrote, citing U.S. monetary policy and other influences.