This Could Change the Way You Invest in the Tech Sector
Changes are afoot for tech companies on the US stock market. S&P Dow Jones Indices and the Global Industry Classification Standard (GICS) have announced that they will create a new sector for tech, media, and telecom companies on September 28 – the first categorization changes for tech companies since 1999.
S&P and MSCI are eliminating the current Telecoms sector, replacing it with a new subdivision called Communications Services. Communications Services will include companies providing communication platforms, as well as media operators, ultimately forming the largest sector on the S&P 500.
Additionally, the new subdivision will integrate companies from the Consumer Discretionary sector that are presently classified under the Media and Internet and Direct Marketing Retail umbrellas. Some companies listed under Information Technology will also transition to the new sector.
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The changes aim to reflect an era of immune-to-classification fluidity for some of the world’s largest tech companies – something that was foreign in 1999, during the peak of the first tech bubble. While Apple slots easily into the Technology sector and Communications Equipment industry thanks to the moneymaking machine that is the iPhone, companies like Facebook – a social network, media company, and the world’s largest news distributor, all in one – are more difficult to categorize.
The GICS hopes to better reflect the changes of the past 20 years while reminding investors where listed companies earn the bulk of their revenue. David Blitzer, S&P Dow Jones Indices index committee chairman, declared the lines between media, communications, and content to be “blurred”, admitting that “It is time to acknowledge this convergence and the overlapping services these companies provide.”
Facebook and Alphabet will both move to Communication Services from their previous tech sector categorization, with both companies’ sub-industry changing to Interactive Media and Services. Netflix will move from Consumer Discretionary to Communication (along with Disney and 21st Century Fox) while also changing sub-industry from Internet and Direct Marketing Retail to Movies and Entertainment.
The reclassification effort will affect exchange-traded funds designed to specific industries but will not require action from investors, according to investment giant Vanguard. Chris Harvey, Wells Fargo’s head of US equity and quant strategy, also posited that certain companies “may gain mindshare and potentially garner more portfolio-manager interest/dollars” as investors re-familiarize themselves with the stocks. The company estimated that only 10 percent of the S&P 500 will be influenced by the reshuffling, affecting only categorization, not index weights.
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IYW sees its 50-day moving average cross bullishly above its 200-day moving average
The 50-day moving average for IYW moved above the 200-day moving average on June 26, 2025. This could be a long-term bullish signal for the stock as the stock shifts to an upward trend.
Technical Analysis (Indicators)
Bullish Trend Analysis
The Momentum Indicator moved above the 0 level on June 03, 2025. You may want to consider a long position or call options on IYW as a result. In of 79 past instances where the momentum indicator moved above 0, the stock continued to climb. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where IYW advanced for three days, in of 368 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 354 cases where IYW Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The 10-day RSI Indicator for IYW moved out of overbought territory on July 11, 2025. This could be a bearish sign for the stock. Traders may want to consider selling the stock or buying put options. Tickeron's A.I.dvisor looked at 46 similar instances where the indicator moved out of overbought territory. In of the 46 cases, the stock moved lower in the following days. This puts the odds of a move lower at .
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 12 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
The Moving Average Convergence Divergence Histogram (MACD) for IYW turned negative on July 11, 2025. This could be a sign that the stock is set to turn lower in the coming weeks. Traders may want to sell the stock or buy put options. Tickeron's A.I.dvisor looked at 48 similar instances when the indicator turned negative. In of the 48 cases the stock turned lower in the days that followed. This puts the odds of success at .
Following a 3-day decline, the stock is projected to fall further. Considering past instances where IYW declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
IYW broke above its upper Bollinger Band on June 24, 2025. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
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