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Outlook for 2021: Technology Sector Will Continue Driving Growth and Prosperity in the Interconnected Global Economy
For a multitude of reasons, 2020 was a year that defied expectations. When the history of the 21st century is written, I hope that 2020 will be described as an outlier. From my perspective, it seems foolhardy to predict the future based on what’s happened in the past 12 months. And yet that is exactly what many financial analysts are doing.
“As long as Wall Street has been in existence, it has been a tradition around this time of year for market participants to make predictions about what might happen to stock prices, interest rates, commodities and exchange rates in the following 12 months. These predictions garner a lot of attention, as they are made by very smart people with access to the best data and vast resources at their disposal. And yet, far more often than not these predictions end up being hilariously wrong,” writes Jared Dillian of Bloomberg News.
I agree with Jared, but only up to a point. I remain highly confident in the ability of the tech sector to deliver high value over the next 12 months. As a result, I’m bullish on tech stocks and I believe they will continue to provide much-needed economic growth.
Tech has graduated from its role as a supporting player. It’s now a legitimate star. Tech deserves its new status; as other part of the economy faltered, tech remained a sturdy and reliable engine of prosperity.
If you’re looking for a list of specific stocks to keep an eye on, I recommend reading Philip van Doorn’s excellent article in MarketWatch. Not surprisingly, tech stocks are front and center.
“Some of the best-known stock-market winners of 2020 are companies with innovative technology and services that businesses and consumers have relied on for remote access. Yet many aren’t yet included in the S&P 500 Index,” he notes. That means that if you were paying close attention to the indexes, you might have missed some golden opportunities.
His list includes tech stocks such as Cloudflare, Zscaler, RingCentral, Carvana, Twilio, Roku, and Spotify. I’m not saying that every one of these picks is a slam-dunk, but it’s worth remembering that promising stocks can be overlooked.
As Jared Dillian writes at the conclusion of his article, “the only reliable prediction to make is that there will be plenty of surprises in 2021.”