The Nasdaq Composite fell 2.1 per cent in early dealings as shares in Meta, one of the largest constituents of the tech-heavy index, dropped by over a quarter, shedding more than $230 billion of its value.
Meta overnight reported its first decline in daily active users and warned of increased competition from rivals such as ByteDance’sThe S&P 500 share gauge dropped 1.4 per cent. Following Wall Street’s worst January since 2009, driven largely by falls in tech stocks that dominate the US indices, the equity benchmark has lost more than 5 per cent this year.
Shares in PayPal had declined by a quarter on Wednesday after the payments company warned that a weakening ecommerce environment would slow its growth rate. Music streaming platformShares in many tech companies raced higher during the pandemic, fuelled by a combination of coronavirus lockdowns keeping customers at home and ultra-low interest rates increasing the appeal of more speculative investments.
But this year, some traders have started to believe the virus is becoming milder and the US central bank has signalled that it is poised to rapidly raise borrowing costs, casting a pall over Wall Street’s tech titans., co-chief investment officer at Arbuthnot Latham. “So when you get an announcement like [Meta’s], investors see the beginning of the end.”