Facebook, Microsoft and Oracle have helped drive the S&P 500 Information Technology index beyond its dotcom peak.
The index closed at 992.29 on Wednesday pipping its previous record of 988.49, which it hit on 27 March 2000 before losing 80 per cent of its value, the Financial Times reports.
S&P’s IT index has outperformed all other US sectors this year gaining 23 per cent compared to 10 per cent in the broader index.
Technology overweights helped US fund managers outperform at a record rate in H1, Bank of America Merrill Lynch figures released this month showed.
The technology-heavy Nasdaq Composite passed its dotcom high in 2015.
Amazon does not feature in the S&P IT index, while Microsoft is one of the few names from the dotcom bubble that remains a major constituent of the index today. It is joined by Apple, Alphabet and Visa as well as Facebook.
Aviva Investors global equities fund manager Richard Saldanha says people forget the tech sector is much broader than the FANG (Facebook, Amazon, Netflix, Google) stocks with opportunities in semiconductors and auto and industrial chip technology.
“The potential opportunity for tech companies to repatriate overseas cash and use it for further capital deployment should also not be overlooked,” Saldanha says.
“It is also worth noting that income investors have been gravitating over to the sector as companies are starting to use their healthy cash generation to pay attractive dividends.”