The Simple Truth About Tech’s Downswing
Dear Rundown Reader,
First, before we get started…
Yesterday, we misquoted Wayne Gretzky. We intended to say he “skates to where the puck is going,” not where it is. No disrespect intended to The Great One.
With the changes HOG announced, we believe they’re also skating to where the puck is going. It’s a good thing.
Now for today…
Monday was rough for market players. Especially in tech.
Facebook and Netflix were the biggest drags, and now experts are questioning the entire tech sector’s strength.
Are the FANGs, and tech as a whole done?
Today’s Rundown looks at the action and shows you what to make of tech’s recent slide.
Your Rundown for Tuesday, July 31, 2018…
Facebook and Netflix Break the Market
There’s trouble in FANGville.
Over the past few days Facebook (NASDAQ: FB) and Netflix (NASDAQ: NFLX) led a free fall that was enough to bring down the entire FANG index.
Bloomberg reports the FANG index fell 9% over the past three days, with Netflix down 5.3% and Facebook retreating 3.3%.
When two of tech’s leading companies take a hit like that the entire market feels it. It was painful. Billions were lost.
According to Bloomberg, the downswing “erased $240 billion from the market cap of the S&P 500 Information Technology Index.”
A hard pill to swallow, but does this mean panic time?
No, not yet… Amazon crushed earnings and a good report from Apple today would make this quarter’s FANG losses a 50 / 50 split.
“I don’t think it’s going to be the start of a big selloff,” notes Richard Golinski of BOS speaking to The Wall Street Journal. “For it to tip the balance” Apple or Amazon would have to run into problems, he notes.
More importantly there’s a lot more to the tech sector than just the FANGs. Chipmakers, autonomous driving systems, artificial intelligence, robotics, augmented reality, blockchain tech… the list of money making opportunities goes on and on.
And the simple truth is this…
The world runs on tech, and will run on more tech tomorrow. Meaning this is a high-growth sector no matter how you slice it.
All you have to do is hitch your wagon to the right bull.
Now, turning to the markets this morning…
Market Rundown for Tues., July 31
Yield on the 10-Year Treasury sits at 2.958% this morning, down 0.017.
S&P 500 futures are up 7.25 to 2,810. A nice bounceback from yesterday.
Oil’s down slightly to $69.73.
Gold’s down $2.00 to $1,229.
Bitcoin goes for $7,879 this morning, according to CoinDesk. Testing support levels this morning. Another big day for HODLs.
We’ll talk again on Wednesday.
For the Rundown,