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The Nasdaq composite, home to Apple, Amazon, Zoom, Tesla and many other tech stocks that led the market's remarkable five-month comeback from its lows in March, has lost more than 10% after setting an all-time high just four days ago -- a decline known in the market as a correction. Investors' craving for technology companies was fueled by low interest rates, customers stuck at home while the pandemic raged, and efforts by the U.S. government to support out-of-work Americans. An improving outlook for corporate profits has also kept traders in a buying mood.
Even with the recent pullback, tech stocks are still leading the other 10 sectors in the S&P 500 with a gain of just under 23% so far this year. "These stocks just got bought up to the point where even the most optimistic of forward estimates won't be enough to justify these valuations," said Sam Stovall, chief investment strategist at CFRA.
The Dow Jones was saved by the Stimulus package that covered the asses of many CEO businesses who stayed open and endured up to now. But, the money is now gone! Expect a major Stock Market Crash more sooner than later!
As more people around the world get sick with covid and stop driving crude will continue to go down as will the Canadian Liberal looney. Hedge time!