Tech stocks led before coronavirus and will likely lead after: BMO strategist

Brian Belski, chief investment strategist at BMO Capital Markets, talks markets amid the COVID-19 pandemic, focusing on tech and financial stocks. Microsoft shares rose as much as 5% in extended trading on Wednesday after the company reported fiscal third-quarter sales growth of 15%, fueled by its cloud business. The company said in a statement that the coronavirus “had minimal net impact on the total company revenue” in the quarter and that “effects of COVID-19 may not be fully reflected in the financial results until future periods.” Here’s how the company did: Earnings: $1.40 per share, adjusted Revenue: $35.02 billion Analysts polled by Refinitiv had expected $1.26 in adjusted earnings per share on $33.66 billion in revenue for the quarter, which ended on March 31. Net income rose 22% to $10.8 billion. The results, along with Alphabet’s on Tuesday and Facebook’s on Wednesday, show that the mega-cap tech companies have held up so far, at a time when unemployment broadly is skyrocketing and the economy is shrinking. Alphabet and Facebook both indicated that ad prices are stabilizing after a steep drop in March. Microsoft’s revenue grew 15% from $30.57 billion on an annualized basis in the quarter, according to the statement. With respect to guidance, Microsoft expects $35.85 billion to $36.80 billion in fiscal fourth-quarter revenue, or $36.33 billion in the middle of the range. That implies 7.7% growth — which would be the slowest growth since the first quarter of 2017 — and the forecast is higher than the $36.42 billion Refinitiv consensus estimate. The company sees quarterly revenue declines search excluding traffic acquisition costs, Enterprise Services and its on-premises server business. The stock lost some of its gains after Chief Financial Officer Amy Hood issued the guidance on the company’s Wednesday conference call with analysts. For access to live and exclusive video from CNBC subscribe to CNBC PRO: https://cnb.cx/2JdMwO7 » Subscribe to CNBC TV: https://cnb.cx/SubscribeCNBCtelevision » Subscribe to CNBC: https://cnb.cx/SubscribeCNBC » Subscribe to CNBC Classic: https://cnb.cx/SubscribeCNBCclassic Turn to CNBC TV for the latest stock market news and analysis. From market futures to live price updates CNBC is the leader in business news worldwide. Connect with CNBC News Online Get the latest news: http://www.cnbc.com/ Follow CNBC on LinkedIn: https://cnb.cx/LinkedInCNBC Follow CNBC News on Facebook: Follow CNBC News on Twitter: https://cnb.cx/FollowCNBC Follow CNBC News on Instagram: https://cnb.cx/InstagramCNBC #CNBC #CNBC TV