Technology stocks are rallying again as interest rates fall and fundamentals improve.
The S&P 500 rose 3.5 percent in March, while the Nasdaq-100 surged 9.5 percent. That 6 point lead by the Nasdaq was its widest margin of outperformance since early 2009, according to TradeStation data.
Interest rates remain a key driver. Treasury yields fell sharply last month as the collapse of Silicon Valley Bank spurred fears across financial markets. The Federal Reserve reversed early signals for more tightening and suggested rates are near their peak. It could be the opposite of early 2022, when surging yields and an increasingly hawkish Fed hammered growth stocks.
At least two fundamental trends also boosted sentiment. First, March saw major announcements related to Artificial Intelligence (AI) from companies like Microsoft (MSFT), Alphabet (GOOGL) and Adobe (ADBE). Excitement about AI not only gave tech investors a new area for optimism beyond established markets like cloud and advertising. It also lifted semiconductor stocks like Nvidia (NVDA) and Advanced Micro Devices (AMD), whose products will be needed to power the vast computing needs of AI.
A second narrative was improving profitability after companies like Salesforce.com (CRM) and Meta Platforms (META) slashed jobs. META additionally benefited from hopes that lawmakers will ban rival TikTok.
Intel (INTC) could also be showing signs of a turnaround after announcing new chips will be available ahead of schedule. That was welcome news from a company that’s struggled with product delays for years. It also made the once-mighty tech stock the top performer in the S&P 500 last month.

Big Movers in March
Top Gainers in the S&P 500 Last Month | ||
Intel (INTC) | +31% | New server chips will be available sooner than expected. That spurred hopes of a turnaround in the struggling tech name. |
First Solar (FSLR) | +29% | The green-energy company reported strong quarterly results and guidance, supported by government tax credits. |
Advanced Micro Devices (AMD) | +25% | Third Point built a position in the semiconductor stock, followed by AI excitement. |
Salesforce.com (CRM) | +22% | Earnings, revenue and guidance beat estimates. The software company also focused on profitability and AI amid pressure from activist investors. |
Meta Platforms (META) | +21% | The parent of Facebook rose as job cuts boosted profits and rival TikTok faced pressure on Capitol Hill. |
Top Gainers in the S&P 500 Last Month | ||
First Republic Bank (FRC) | -89% | The collapse of Silicon Valley Bank weighed on the California lender, which also had a large proportion of uninsured deposits. |
Zions Bancorp (ZION) | -41% | The Salt Lake City-based lender fell as anxiety swept regional banks. |
Comerica (CMA) | -38% | The Dallas bank fell with other regional lenders. |
Charles Schwab (SCHW) | -33% | The brokerage fell on worries about its potential to lose deposits. |
KeyCorp (KEY) | -32% | The Cleveland-based lender fell on lower guidance and turmoil in the banking sector. |
Sector Watch
Technology | +11% |
Communications | +8.4% |
Utilities | +4.2% |
Consumer Staples | +3.7% |
S&P 500 | +3.5% |
Consumer Discretionary | +2.7% |
Health Care | +1.8% |
Industrials | +0.2% |
Energy | -1% |
Materials | -1.4% |
Real Estate | -2.2% |
Financials | -10% |
Key Economic Events in March
Below are some key economic events from last month.
- Labor Pressures Eased as Jobs Increase: The U.S. economy added 311,000 jobs in February, 106,000 ahead of estimates. Still, unemployment rose more than expected and wage gains lagged forecasts. That suggested a tight labor market isn’t driving inflation. (3/10)
- Housing Starts Jump More Than Expected: Housing starts rose 9.8 percent to an annual rate of 1.45 million in February. That exceeded forecasts for 1.32 million. Building permits also surprised to the upside. (3/16)
- Fed Hikes But Signals a Potential Pause: The Federal Reserve increased interest rates by 25 basis points as expected. However, its forward projections suggested further tightening could be limited. (3/22)
- Consumer Confidence Surprises to the Upside: Consumer confidence rose more than expected in March and February’s reading was revised higher. The improvement resulted from increased spending plans and greater optimism over the next six months. (3/28)
What Experts Are Saying
Below are some noteworthy commentaries.
- Neuberger Berman portfolio manager Steve Eisman said recent turmoil in the banking sector is confined to certain regional lenders. Known for shorting financials in 2008, Eisman said the current situation isn’t close to the subprime meltdown. (3/20)
- FactSet calculated the S&P 500 could rise 17 percent in the next year, based on research estimates. The median price targets of analysts for companies in the index translate into a potential move to 4,618. Energy had the most projected upside and technology had the least, according to FactSet. (3/24)
- Bank of America said commercial real estate could be the next danger for U.S. lenders. Higher interest rates and lower occupancy could squeeze regional banks that dominate the market. (3/25)
- Jeffrey Gundlach, founder of DoubleLine Capital, predicted a recession will begin “in a few months.” The slowdown will drive the Fed to cut interest rates twice, he added. (3/27)
- Ed Yardeni of Yardeni Research predicted S&P 500 will rally to 4,600 by yearend as the Fed halts rate hikes. He said the banking crisis was well-contained and thinks earnings will improve after the first quarter. (3/27)
Popular Futures Contracts in March
Product | Current Month | Expiration | Next Month | 1-Mon% |
S&P 500 E-Mini (@ES) | ESM23 (June) | 6/16/23 | ESU23 | +3.2% |
Nasdaq-100 E-Mini (@NQ) | NQM23 (June) | 6/16/23 | NQU23 | +9% |
Dow Jones E-Mini (@YM) | YMM23 (June) | 6/16/23 | YMU23 | +1.6% |
Russell 2000 E-Mini (@RTY) | RTYM23 (June) | 6/16/23 | RTYU23 | -5.3% |
Newsworthy Events This Month
Date | Event | What to Watch For |
Fri 4/7 | Non-farm payrolls | Job growth, wages and unemployment. Will recent gains be revised lower? |
Wed 4/12 | Consumer prices, Fed Minutes | The consumer price index (CPI) is an important inflation report. Minutes from the last Fed meeting could provide clues on monetary policy. |
Fri 4/17 | Retail sales, earnings begin | Retail sales are due in the premarket. JPMorgan Chase (JPM) and Citi (C) are the first major companies to report quarterly results. |
Tue 4/18 | Housing starts, building permits | Will the lower interest rates boost the housing market? |
Thu 4/27 | Gross domestic product | The first of three reports on economic growth in the first quarter. |
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