Big Tech stocks that lifted markets to record highs in the first half of 2024 are now being pummeled. Mega cap tech giants like Microsoft, Meta, Apple and Amazon will have a chance to win back gains when they report quarterly earnings next week. But it may be too late. Investors—eyeing a potential Fed rate cut or perhaps hedging against election and geopolitical uncertainty—have already shifted funds to more value-oriented sectors in what the Wall Street Journal called “a stock-market rotation of historic proportions.”
To get a sense of what's underway, the S&P 500 and tech-heavy Nasdaq posted their worst sessions since 2022 Wednesday, falling 2.3% and 3.6%, respectively. After an initial recovery Thursday, they both declined again, with the S&P falling 0.51% and the Nasdaq dropping 0.93%. Over the last week, the small caps of the Russell 2000 have beaten the S&P by a margin not seen since at least the 1980s, per the Journal. (All three indexes climbed in early trading Friday, led by the Russell 2000.)
