(Bloomberg) -- After this year’s steep declines for US information technology stocks, Jefferies Group LLC strategists have turned bullish on the likes of IBM, Cisco Systems Inc. and Microchip Technology Inc.

The strategists raised their view on the S&P 500 IT Index to bullish in a note on Wednesday, writing that IT stocks are in “a tradeable rally.”

Their more positive view reflects an easing in the strength of the dollar and credit spreads, and, at least temporarily, in financial conditions. Adding to their conviction, they noted recent improvements in both new orders and the backlog for IT firms.

With growth stocks caught in the cross hairs of rising bond yields and fears of an economic slowdown, the S&P 500 Information Technology sector has slumped 21% this year. Price-earnings ratios have fallen to levels last seen in the early days of the pandemic.

A “dash for cash” as investors discounted some extreme interest-rate scenarios “has been more than reflected in the compression of market multiples,” wrote the Jefferies strategists led by Sean Darby.

©2022 Bloomberg L.P.