Nasdaq has moved less than 0.5% so far this week, but many well-known technology names have seen much higher price fluctuations.
On the one hand, the proverbial FAANG shares, which generally outperformed the Nasdaq in September, rose this week.
Facebook (FB) – Get the report and Netflix (NFLX) – Get the report each rose about 4% from last Thursday’s close, Apple (AAPL) – Get the report is up about 3.5% and Amazon.com (AMZN) – Get the report it is about 4.5%. Alphabet (Google) – Get the report and Microsoft (MSFT) – Get the report each increased just over 1%.
Amazon could get a boost from a press release Monday that trumpets the company’s sales during the holiday season. Among other things, Amazon revealed that its sales in the holiday season involving sellers in the market increased by more than 50% annually.
Apple, which recorded fresh highs this week, seems to be getting another boost from last week’s Reuters report that it is working on an electric car. The continuing signs of a strong iPhone demand could also be helpful.
But while tech giants are having a good week, the same can’t be said for many of Robinhood’s favorites, such as high-end internet, cloud software, and electric car games.
Zoom video communications (ZM) – Get the report, which sold out last week after a report on plans to launch email and calendar applications raised concerns about competitive pressure, fell 6% this week. Likewise, the online TV service provider FuboTV (Fubo) – Get the report fell 16% this week after being dumped on Thursday last year due to a very low report from LightShed Partners.
C3Ai (you) – Get the report, which was auctioned to a nosebleed assessment, despite major COVID-related sales pressures this year, also fell 16%. Snowflake (THE SNOW) – Get the report decreased by 6%, Palantir Technologies (pLTR) – Get the report fell 11% and (due to a big sale on Tuesday), the developer of batteries for electric cars QuantumScape (QS) – Get the report decreased by 14%.
What causes this technological rotation? End-of-year transactions for tax and portfolio rebalancing could play a role. Also Tesla (TSLA) – Get the report joining the S&P 500 a week ago is a potential catalyst.
The fact that the S&P 500 indexed funds had to reduce their positions in FAANG and Microsoft shares (MSFT) – Get the report helping space for Tesla has been a headwind in recent weeks for the actions of many big tech names and that has now disappeared.
Meanwhile, Robinhood favorites could be pressured by the growing number of alarm bells raised by analysts and others about the astronomical ratings that are now given to selected technology companies favored by retail investors.
Over the weekend, The Wall Street Journal published a paper noting that US margin debt had risen to more than $ 700 billion for the first time in history. The WSJ also reported (citing data from Options Clearing Corp.) that the daily volume of options contracts has increased by 48% this year and that inputs for leverage ETFs and vice versa have reached 2008 levels.
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