When I saw this report the first thing that went through my mind was a question. Is there a chance that the reports that have exposed some of the shenanigans going on with Google and the various social media giants have had an effect on the high-tech related industries on the list in this stock market report? I think that’s something worth pondering. Perhaps it’s one of those unintended consequences we’ve heard a lot about.
Stocks sank on Wednesday as a steep decline in tech shares and worries of rapidly rising rates sent Wall Street on pace for its worst day in eight months.
The Dow also closed near its lows of the day.
The S&P 500 dropped 3.3 percent to 2,785.68, with the tech sector underperforming. The broad index also posted a five-day losing streak — its longest since November 2016 — and fell below its 50-day and 100-day moving averages, widely followed technical levels.
Both the Dow and S&P 500 posted their biggest one-day drops since early February, while the Nasdaq notched its largest single day sell-off since June 24, 2016.
Stocks have fallen sharply this month. For October, the S&P 500 and the Dow are down more than 4.4 percent and 3.3 percent, respectively. The Nasdaq, meanwhile, has lost more than 7.5 percent.
Rising rate fears and a pivot out of technology stocks have made it a rough last few days. The Dow has dropped four of the last five sessions.
Shares of Amazon declined 6.2 percent on Wednesday, while Netflix slid 8.4 percent. Facebook and Apple also fell more than 4 percent each. These stocks are top performers for the year and for most of the bull market. For the overall tech sector in the S&P 500, it was the worst day in seven years, dropping 4.8 percent.
“People are getting out of the high-flying tech names right now,” said Larry Benedict, CEO of The Opportunistic Trader. “I think people are under-hedged; there could be more pain ahead.
Here’s another thought for you. Do you suppose investors see the high tech industries as vulnerable due to their tendency towards a liberal viewpoint, especially considering the impending Red Wave in the upcoming election? There has been a lot of talk about censorship of conservatives in the social media platforms, and we saw FB take a pretty big hit not long ago, possibly due to a perceived decline of popularity of the platform. Then there is Nike, who made Colin Kaepernick on the payroll as their poster boy. Granted, the stock bounced back, but they took a four-plus billion dollar drop in value in one trading day. I’m by no means an expert in these areas, but if a rank amateur like myself can come up with these ideas, the more sophisticated investor would likely have better analysis than I do.
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