Is the Tech Comeback Real?

Financials may move the market, but technology leads it. After slumping for four straight weeks and sharply and conspicuously underperforming the markets, the tech sector (XLK) is staging a comeback -- and a broad-based comeback at that, with semis, hardware and software groups all moving into the leader column again. If this lasts -- and that's a big if -- it would be a very positive development for stocks, and a good economic indicator as well.

We had analyst Kim Caughey Forrest of Fort Pitt Capital on to talk about the latest in tech. She says she likes the corporate capex story more than the crowded consumer "i-anything" trade -- that is, of course, the trade for anything Apple (AAPL). She says she'd put her investment dollars in the tech sector that specializes in business to business.

Of course the exception to this recent trend reversal is Research in Motion (RIMM), which is paying dearly for giving weak short-term guidance in Thursday's earnings report, even though its full-year earnings-per-share outlook is about 10 percent ahead of consensus estimates.

Is this an over-reaction on RIM? Probably, Caughey-Forrest says, but it's sales growth investors want to see. Will RIM's answer to the iPad drive sales (the PlayBook is set to go on sale April 19)? That remains to be seen. As Caughey Forrest says, "RIM isn't really a consumer play...it's always been something businesses have loved and Wall St. loves because it was the first email reader available." Meanwhile, as more consumers buy anything with an i in front of it, "Apple is really dropping those top-line sales" but may not have a solid place in corporate IT infrastructure.

Her bottom line on RIM: She'd be ''very cautious" on chasing it.

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