Big tech stocks might be the only thing immune from the coronavirus.
While COVID-19 has infected more than 3.85 million people globally and nearly 1.3 million people in the U.S. alone, some of the tech sector’s biggest names have proven to be resilient amid the coronavirus-induced economic downturn.
Google-parent Alphabet jumped 7% following its earnings release. Facebook popped as much as 10% after its. Netflix gained a more modest 2.4% after it reported nearly double the amount of new subscribers than anticipated. And Apple shares are up nearly 5% after it beat earnings estimates for its fiscal second quarter.
And while Amazon (NASDAQ: AMZN) posted less profit than anticipated as it continues to spend a fortune on its shipping and logistics network amid surging sales due to the coronavirus shutdowns, shares have risen nearly 16% over the last month.
These FAANG stocks have proven to be some of the strongest as other corners of the market have been ravaged by the pandemic.
One compelling reason: as people are stuck at home, they are using these companies products and services more. Need to buy household goods but can’t stomach going to the store? Amazon. Need an entertaining distraction? Netflix. Bored? Scroll through Facebook or its sister-app Instagram. And you might be doing all of it on you iPhone or MacBook.
Another stock that fits in with the group is Microsoft (NASDAQ: MSFT). Microsoft shares are up 35% since bottoming on March 23, with the tech giant reporting a 16% sales jump for the last quarter as businesses flock to its Microsoft Teams app to facilitate communication as employees work from home.
“As COVID-19 impacts every aspect for our work and life, we’ve seen two years’ worth of digital transformation in two months,” said Microsoft CEO Satya Nadella in the company’s earnings release.
Big tech, it seems has been what the world needed to weather the coronavirus’ unprecedented economic shutdown.
But while these top tech names have been faring well amid the pandemic, other sectors haven’t been so lucky.
Department store retailers like Macy’s (NYSE: M) and JCPenney (NYSE: JCP), which were struggling even before the coronavirus, are knocking on death’s door, while Neiman Marcus and J.Crew have already filed for bankruptcy protection.
And airlines like American Airlines (NASDAQ: AAL), Delta (NYSE: DAL), Southwest (NYSE: LUV), and United (NASDAQ: UAL) have taken a beating as travel all but ceases, made worse by Warren Buffett saying Berkshire Hathaway ditched its entire stakes in the industry.