Breaking News
Get Actionable Insights with InvestingPro+: Start 7 Day FREE Trial Register here
Investing Pro 0
Ad-Free Version. Upgrade your Investing.com experience. Save up to 40% More details

A Volatile Ride For Tech Stocks And Crypto As Worries About Inflation Resurface

By ValueWalk (Jacob Wolinsky)Stock MarketsJan 11, 2022 12:16AM ET
www.investing.com/analysis/a-volatile-ride-for-tech-stocks-and-crypto-as-worries-about-inflation-resurface-200614275
A Volatile Ride For Tech Stocks And Crypto As Worries About Inflation Resurface
By ValueWalk (Jacob Wolinsky)   |  Jan 11, 2022 12:16AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 

Those niggling worries about the impact of a rise in interest rates on the value of future earnings are threatening to fast turn into a painful reckoning for many tech investors.

The punchbowl of cheap and easy money being withdrawn from the party a lot sooner due to soaring inflation is inducing an early hangover for a basket of pandemic winners. It’s not just high growth stocks coming under the cosh, crypto currencies have been on another rollercoaster ride as investors take fright from riskier assets.

Bitcoin dipped below $40,000 dollars before bouncing back, as New Year resolutions of diversification came into play, with some investors offloading the crypto asset for more defensive positions. Crypto assets are highly sensitive to the fortunes of the stock market and have been propelled higher in this era of ultra cheap money, so it’s no surprise they have been hit with a severe case of the jitters as policy makers ponder their next move.

A Volatile Ride For Tech Stocks

The NASDAQ composite index slipped by as much as 4% in early trade, before stemming some losses and was down by around 10% from its November high. Apple (NASDAQ:AAPL) retreated further away from the nascent 3 trillion dollar club, falling 2%. Chip maker NVIDIA (NASDAQ:NVDA) and Mastercard (NYSE:MA) registered falls of more than 5% before recovering slightly.

Amazon (NASDAQ:AMZN) joined the downward trajectory, slipping by 3.6% in early trade. On the FTSE 100, Scottish Mortgage Investment Trust (OTC:STMZF), which holds a raft of tech darlings like Tesla (NASDAQ:TSLA), Nio (NYSE:NIO) and Amazon was among the biggest fallers amid concerns the tech juggernaut is slowing.

With other companies in the big data and payments space slipping back, information analytics firm Experian (OTC:EXPGF) fell lower, ending the day down by more than 5%.

News that Take Two Interactive Software (NASDAQ:TTWO) was set to pay $12.7 billion to acquire mobile gaming company Zynga (NASDAQ:ZNGA) sent its share price plunging 14%. Far from being a steal, there was clearly concern among some investors that the Grand Theft Auto maker could be paying over the odds to drive through the deal. There may still be a lot to play for in a gaming world gearing up for metaverse opportunities, but it’s still an eye watering price tag.

Even Estee Lauder (NYSE:EL) was not immune to the sell-off, dropping by more than 5% amid expectations that an income squeeze could see a fall in demand for discretionary items like expensive perfume. But the lipstick effect could still come into play with a chance that consumers may still splash the cash but just opt for less expensive products from beauty ranges, as they tighten their fashionable belts further.

A Volatile Ride For Tech Stocks And Crypto As Worries About Inflation Resurface
 

Is Apple Undervalued?

Based on 15 different premium valuation models, we calculate whether Apple stock is undervalued or overvalued every day. If you are considering Apple for your portfolio, you need to check this out:

See Fair Value Now
Unlock Apple's unbiased fair value with InvestingPro+

Related Articles

A Volatile Ride For Tech Stocks And Crypto As Worries About Inflation Resurface

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email