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How — and Why — to Buy Tech Stocks Now

Stocks wavered on Monday as investors were encouraged by strong German factory data but the market still remained jittery. Phil Orlando, chief equity market strategist at Federated Investors, shared his outlook with CNBC.

“From a technical perspective near-term, we could lose another 2 to 3 percent,” Orlando told CNBC. “But longer-term, fundamentally…if you look at the spread between earnings yield and Treasury yield, the imbalance is 70 percent, so we’re getting very close to the March 2009 low levels.”

He likes stocks over bonds and domestic over foreign companies.

“Within the U.S. sectors, we like technology—we think we’re in an early cycle of an enterprise refresh cycle,” he said.

  • Nasdaq Composite Index Now

However, watching the economic trends will be key to investing in the sector, he cautioned.

“People are concerned that if this economy does roll over into a double-dip based upon the ugly jobs number on Friday, that will allow a lot of IT professionals to cancel their plans—so there is a risk to that forecast.”

Scorecard — What He Said:

  • Orlando's Previous Appearance on CNBC (May 28, 2010)

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Opposing Market Views:

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CNBC Data Pages:

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CNBC Slideshows:

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Top Tech Firms:

Cisco Systems

Apple

Google

Microsoft

Dell

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Disclosures:

No immediate information was available for Brady or Orlando.

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Disclaimer