A retreat in share prices finally reaches tech stocks

STOCKMARKET BOOMS tend to narrow with age, as investors double down on the shares that have served them well. Throughout 2017 and into the early weeks of this year, a handful of favoured technology stocks, known as FAANG(Facebook, Amazon, Apple, Netflix and Google, part of Alphabet), were the motor for a rapid rise in the S&P 500 index of American stocks (see chart). In this year’s choppier markets, they seemed like a refuge. But this week FAANGand other tech stocks were at the centre of a broader sell-off in global stockmarkets.

Over two trading days, on November 19th and 20th, the FAANGstocks retreated further from the peaks they each achieved earlier this year. At their lowest point all five were down by more than 20% from their pinnacle. Billions of dollars in stockmarket value have evaporated. Apple, which had reached an equity capitalisation of $1trn in early August, was valued at $840bn by the time New York’s stockmarket closed on November 20th. The market...

via The Economist: Finance and economics Business Feeds

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