The Nasdaq Composite skidded closer to correction territory and gave up its gains for the year on Monday as the technology-heavy index endured another day of fierce selling.
The index was down 2.7 per cent at 6,871.35, taking its drop from its record high in March to 9.4 per cent. A correction is defined as a drop of 10 per cent or more from its recent peak.
Tesla led the decline among the big technology stocks, slumping 7.8 per cent as investors continue to digest the spate of negative headlines around the electric car company.
Amazon followed with a 5.1 per cent drop after Donald Trump took another swipe at the ecommerce company, lashing out at its tax policy and its effects on brick and mortar retailers.
Other stocks in the so-called Faangs were not spared. Facebook, whose shares have been hard hit by the data privacy scandal, was down another 2.6 per cent. Netflix lost 4.6 per cent, Alphabet (formerly Google) shed 2.5 per cent and Apple edged 0.8 per cent lower.
Overall the NYSE Fang+ index is down 3.5 per cent for the day at 2,358.50, its lowest level since February 12.
Technology stocks also led the wider market lower. The S&P 500 was down 1.8 per cent at 2,593.18 and the Dow Jones Industrial Average was trading 1.3 per cent lower at 23,799.96.
During the market’s sell-off in February, the Nasdaq was down 9.7 per cent on a closing basis from its then-record high on January 26 but had entered correction territory on an intraday basis. Both the S&P 500 and Dow Jones closed in correction territory in February.
Morgan Stanley analysts said on Monday that the recent stock market sell-off presents a buying opportunity for investors, as the S&P500 looked to test it’s February low and the Nasdaq Composite turned negative for the year.
The team at the US bank argued that many of the drivers of volatility in the market, such as inflation fears, trade concerns and fears of regulatory backlash against internet stock leaders, have now been priced in and that momentum from stimulative economic policies should support first quarter earnings.
“We believe that organic momentum aided by fiscal stimulus coming through early in the year should sustain a supportive environment for earnings growth that will be reflected in 1Q results…We think many of the risks have now been priced and see value in the S&P,” wrote the analysts in a note.
Defensive sectors such as utilities and real estate have benefited from the sell-off. Utilities had their best week of the year last week and traded with gains on Monday morning before slipping and moving down 0.2 per cent heading into the New York afternoon.
“A move higher should change recent trends of defensive leadership,” said the analysts. “Our Equity Risk Indicator is now in buy territory.”
Read Again Nasdaq falls sharply as Amazon and Tesla weigh on shares : https://ift.tt/2pXboRgBagikan Berita Ini
0 Response to "Nasdaq falls sharply as Amazon and Tesla weigh on shares"
Post a Comment