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Amid Increasing Cyber Security Attacks, Cyber Technology Shares Rise


12/19/2020


Amid Increasing Cyber Security Attacks, Cyber Technology Shares Rise
Anticipation of investors about an increase in demand for security technology following a spate of cyber attack disclosures from entities such as Microsoft Corp resulted in a rapid rise in the stock prices of cyber security companies on Friday.
 
Following the disclosure by Microsoft on Thursday that malicious software in its systems had been detected by it, shares of cyber security firms such as FireEye Inc, Palo Alto Networks and Crowdstrike Holdings all raced ahead. The malicious software found by Microsoft was related to a massive hacking campaign disclosed by United States officials this week. The disclosure of the software giant added it to a growing list of companies and government agencies that had faced the cyber attacks.
 
Services and networking management security software of Orion is used by Microsoft. Orion’s system is a widely deployed software owned by SolarWinds Corp and that system was used in the alleged attacks on vital US agencies and others by suspected Russian hackers. .
“This news increases the awareness in regards to the federal government’s susceptibility to cyber attacks from Russia and other foreign entities,” said Daniel Morgan, portfolio manager at Synovus Trust in Atlanta.
 
Technology security companies are “all perceived to benefit from an increase in spending and awareness”, Morgan said and added that he expects that awareness will happen as the US government looks to prevent future hacks.
 
There was a 25.21 per cent jump in the shares of FireEye to $17.99 which was the highest for the stock since January. This also put the stocks on track to make their highest one day percentage gain since January 2014. After FireEye became the first organization to disclose an attack related to the recent hacking campaign, the stocks of the company had dropped to below $14 on December 9.
 
There was also a gain of 9.7 per cent and 4.8 per cent in the share prices of other cyber security firms Crowdstrike and Zscaler respectively, as a part of investor focus on cyber stocks. 
 
The recent cyber attacks could be ranked among the worst ever and also underscore a large market for cyber security products, Wedbush analyst Daniel Ives wrote in a research note.
 
(Source:www.economictimes.com)