Investors seeking momentum may have Technology Select Sector SPDR ETF (XLK Quick QuoteXLK - Free Report) on radar now. The fund recently hit a new 52-week high. Shares of XLK are up approximately 46.5% from their 52-week low of $103.47/share.

But could there be more gains ahead for this ETF? Let’s take a look at the fund and the near-term outlook to get a better idea of where it might be headed.

XLK in Focus

The underlying Technology Select Sector Index includes companies from the following industries: computers & peripherals; software; diversified telecommunication services; communications equipment; semiconductor & semiconductor equipment; internet software & services; IT services; wireless telecommunication services; electronic equipment & instruments; and office electronics. The expense ratio is 0.12%.

Why the move?

The dovish Fed minutes dragged down the treasury yields on Jul 7, which benefitted tech stocks as these are high-growth in nature. Moreover, fears of delta variant of COVID-19 are also causing higher demand for the tech stocks as these are winning ones amid the stay-at-home trend. Plus, the sector has solid long-term potential.

More Gains Ahead?

The fund has a Zacks Rank #2 (Buy) and a positive weighted alpha of 40.85. So, there is a decent outlook ahead for those who want to ride this surging ETF a shade further.

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