Wedbush Securities analyst Dan Ives said in a note Thursday that investors should focus on “oversold” tech stocks and cybersecurity companies as global markets sink after Russia invaded Ukraine.
Tech names will likely see “significant pain” amid the sell-off Thursday, Ives said. Investors continue to seek out safe havens, sending stocks lower, while pushing the price of oil, government bonds and gold higher. But, Ives said investors shouldn’t panic, and should instead focus on large-cap tech stocks.
“While each geopolitical shock event is different and unique, our playbook since 2000 has been to use these periods of global chaos to buy the tech winners that we view as way oversold in a panic-like sell off,” he said.
Ives listed a number of technology names that investors should look to, including Microsoft, Apple, Oracle, Adobe and Salesforce, “as well as core chip names.”
Microsoft shares closed up 5% on Thursday, while Apple rose 1%. Oracle was up 3%. Shares of Adobe jumped 8% and Salesforce surged 7%.
The cybersecurity sector could also see a lift as a result of the invasion, Ives said. Experts previously warned of possible cyber ramifications from the conflict. And on Wednesday, several Ukrainian government websites were knocked offline due to a mass distributed denial of service attack.
“With significantly elevated cyber attacks now on the horizon, we believe added growth tailwinds for the cybersecurity sector and well-positioned vendors should be a focus sector for investors during this market turmoil,” Ives said.
Palo Alto Networks, CrowdStrike, Zscaler and Tenable were among several “core cybersecurity names” Ives said are most likely to benefit from heightened threats of cyberattacks.