It’s the perfect narrative. Inflation data is released, the market expects a cash rate rise, and the ASX’s rate-sensitive technology sector suffers. But fund managers say worsening sentiment and investor ire at stock-based compensation are bigger problems for the ASX’s technology companies. And that’s not to mention the uncertainty created by the arrival of artificial intelligence on the future growth of a string of listed software businesses.
“The thematics driving this are much bigger and much stronger than a 25 basis point rise in rates,” said Forager Funds chief investment officer Steve Johnson. The firm, which has around $470 million in funds under management, had about 40 per cent of its portfolio in tech stocks three years ago but has dramatically reduced its exposure since.
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