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Traders weigh buying big tech after Microsoft's earnings beat

The "Fast Money" traders think there might be some opportunities in major technology companies ahead of their earnings reports.

Big technology companies are where investors should want to be in general, according to trader Pete Najarian. He explained that as traditional defensive sectors like utilities have become more expensive, investors have looked for opportunities in the tech sector.

There are also reasons to be optimistic about the sector as Microsoft posted an earnings report that beat analyst expectations on Tuesday.

Najarian said that companies such as Cisco, Intel and Microsoft look attractive because of their relatively low valuations and dividend yield. He warned however, that it may be a little late to trade big tech.

Trader Steve Grasso agreed with Najarian's last point, saying he's not bullish on IBM and a lot of these other big tech companies. He said that the environment of low interest rates has pushed people into riskier assets as they search for yield outside of traditional safe-haven government bonds. Grasso cautioned that the market could reprice soon.

Trader Guy Adami said Cisco is an interesting stock because not only is it "reasonably valued," but it also reports earnings in August, much later than some of the other major companies.

Disclosures:

PETE NAJARIAN

Long Stock: AAPL, BAC, BMY, CSCO, DIS, DISCA, GE, KMI, KMI.A, KO, LUX, MRK, PEP, PFE, VIAB Long Calls: AAL, AKS, AMJ, ANF, CHK, CLF, DAL, DVN, HALO, INTC, KGC, MPEL, MRO, MSFT, LLY, MT, MU, NTAP, NGD, P, SBUX, SLV, SLW, TMUS, XLE, YELP Puts: CS, NLY, EEM

KAREN FINERMAN

Karen is long AAL, BAC, C, DAL, DRII, DRII calls, FB, FL, GOOG, GOOGL, JPM, LYV, KORS, KORS, KORS puts, M, MA, SEDG, SPY puts, UAL, URI, WIFI long call spreads. Her firm is long ANTM, AAPL, BAC, C, C calls, DRII, DRII calls, FB, GOOG, GOOGL, JPM, JPM calls, KORS, LYV, M, MOH, PLCE, SPY puts, URI, WIFI. Her firm is short IWM, MDY. Finerman is on the board of GrafTech International.

STEVE GRASSO

Steve Grasso is long BA, CC, EVGN, JCP, KBH, MJNA, MU, OLN, PFE, PHM, T, TWTR, GDX Grasso's Kids Own EFA, EFG, EWJ, IJR, SPY. No Shorts. Stuart Frankel & Co Inc. and some of its Partners are long AAPL, AVP, FCX, IBM, KDUS, LDP, MFIN, MJNA, NE, RIG, STAG, TEX, TITXF, URI, VALE, WDR, XRX, ZNGA, CUBA, ICE, HSPO, JCP, NXTD, SDS and short DIA, QQQ, SPY, XLI

GUY ADAMI

Guy Adami is long CELG, EXAS, GDX, INTC. Adami's wife, Linda Snow, works at Merck.