Shares of Seagate Technology PLC (NASDAQ: STX) jumped today after tech stocks rallied in the broader market and after an analyst's investor note suggested a new cryptocurrency could boost demand for hard disks.
The tech stock gained 12.1% in today's trading.
Many technology stocks were rebounding today after taking a hit for most of this year. Investors appear interested in tech stocks again after several months of a sell-off. Investor sentiment may be shifting back to technology stocks as investors try to figure out how to invest in a U.S. economy that's opening back up but still facing high unemployment and inflation.
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But some tech stocks, including Seagate Technology and Western Digital (NASDAQ: WDC), were also gaining today because Morgan Stanley analyst Joseph Moore said that a new cryptocurrency, called Chia, could boost demand for hard disks.
Much of the current crypto market relies heavily on graphics processing units (GPUs) to "mine" the coins, but Chia uses unused storage on a hard drive to generate the cryptocurrency. And if it takes off, then stocks like Seagate and Western Digital could benefit.
Investors have been all over the place with tech stocks lately, so keep in mind that there could be more volatility ahead with Seagate's stock as investors try to map out their investing strategies right now. But if a new cryptocurrency does in fact boost storage demand, then Seagate investors are right to be optimistic today.
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