This article was originally published on ETFTrends.com.
Technology ETFs seemed to have picked up where they left off after the recent pullback, leading market gains as traders put uncertainty into their rear view.
Among the best performing ETFs on Wednesday, the Invesco Dynamic Software ETF (PSJ) increased 5.6%, Invesco DWA Technology Momentum Portfolio (PTF) advanced 5.5%, SPDR FactSet Innovative Technology ETF (XITK) increased 4.0% and iShares North American Tech-Software ETF (IGV) rose 4.0%. PSJ, XITK and IGV were all testing their long-term resistance at the 200-day simple moving average as well.
“These stocks are the leaders of this bull market,” Jason Benowitz, senior portfolio manager at Roosevelt Investment Group Inc., told Bloomberg. “If we’re going to have a rally, they’re going to participate in it.”
U.S. Stocks Rally
U.S. stocks rallied with technology outperforming on Wednesday after the midterm elections revealed a divided congressional power and eased concerns over quick policy changes that could affect corporate America.
“Markets typically do well when you have a split Congress,” Todd Jablonski, chief investment officer at Principal Portfolio Strategies, told the Wall Street Journal. “Investors feel comfortable with that; it gives a sense of stability and a sense that change won’t happen too quickly.”
Democrats held the majority in the House of Representatives while Republicans widened their control over the Senate, resulting in a split Congress between two major political parties.
While there are lingering concerns over tighter financial conditions with the Federal Reserve still embarking on a interest rate hike regiment and trade policy between the U.S. and China, observers argued that a split Congress will make radical economic policy changes less likely, at least in the near term.
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