The iShares Expanded Tech-Software ETF surged 21% in May, its strongest month since 2001, as AI-driven demand lifts key stocks.
The iShares Expanded Tech-Software ETF climbed 21% in May, marking its best monthly performance since October 2001. The rally was fueled by strong earnings from Snowflake and Okta, easing fears of a prolonged downturn in software stocks amid AI disruption.
The ETF had underperformed the broader Nasdaq, which is up 18% year-to-date, but May’s gains narrowed the gap. Snowflake’s $6 billion cloud and chip deal with Amazon and raised guidance drove its stock up nearly 50% in four trading days, highlighting demand for AI-integrated tools.
Despite the rebound, the ETF remains down 3.8% for the year, reflecting lingering concerns over AI’s impact on traditional software models. Analysts noted customers are accelerating workload deployments, signaling potential stabilization in the sector.