By Medha Singh

(Reuters) – Despite rising bond yields, battered technology and growth stocks have managed to push a rebound of world stocks. Some investors see them as a hedge against inflation in the face of increasing supply chain snarls in Ukraine and an intensifying conflict in Ukraine.

The NYSEFANG+TM index which comprises five core FAANG stock – Meta Platforms and Apple (NASDAQ.com), Amazon.com and Netflix (NASDAQ.) – saw their strongest six-day performance, with Tuesday’s 22% rise exceeding the 8% increase in the same period.

Growing stocks are usually less successful as yields rise. However, the benchmark hit its highest point since 2019, which was due to concerns about an aggressive monetary tightening.

As tech stocks and growth stocks rely heavily on cash flow in the future, higher interest rates are more likely to hurt them. The tech-heavy is down nearly 10% year-to-date, steeper than the 4% decline in the benchmark S&P 500.

“In the face rising 10-year yields, (investors have) left bonds and moved toward equities. They are looking toward areas of growth that were beaten up but I am not sure if this will last,” Sam Stovall from CFRA Research New York, chief investment strategist.

According to some analysts, technology stocks could be resistant to inflation because their profits are relatively immune to higher commodity prices than those of manufacturing companies and consumers.

Mark Taylor, Mirabaud Securities sales trader, said that “high operational gearing and sticky consumers lend themselves to some sympathy.”

Hong Kong’s tech companies have risen by 36% in the past week, thanks to Beijing’s market friendly concessions last Thursday that buoyed hope that the worst regulatory tightening is over.

Japan’s tech stocks rose seven consecutive sessions while European ones also saw gains.

“The Chinese market has seen a strong rebound,” Emmanuel Cau (head of equity strategy) at Barclays (LON.) Added that the market is growing and many funds may reengage in a sector shunned at the beginning of the year.

Research by Vanda (NASDAQ 🙂 Analysts said that a rebound in stock prices was due to a surge in retail investor buying following last week’s Federal Reserve rate increase.