Tech stocks have continued to slump due to the continuous selloff in the sector as bond yields grow further.
- The Nasdaq Composite index has recorded a $1.5-trillion rout in the first week of the year, dragging stocks down at least 10%. The Nasdaq 100 Index slipped 1.7% on Monday, down by 7.5% since late 2021.
- The decline comes as US 10-year Treasury yields hit 1.80%, driving concerns that higher interest rates will continue to hit long-term profit-based valuations. Investors have been discouraged from entering until the release of fourth-quarter results.
- Morgan Stanley’s Michael Wilson noted that stocks have never been so expensive for the overall market, indicating that valuations are likely to decline further before the correction ends.
Bulls believe the megastocks will hold up, given the opportunity to start rebuilding positions given their good growth, high margins, and strong balance sheets.
IXIC closed up 0.05%.