Tech-ing Time Bomb
And boom goes the tech sector! Yesterday’s Huawei madness may have sparked concerns of a broader sell-off in the tech sector following a sizable downturn during yesterday’s session. Tick tock.
Global stocks took a hit yesterday after Google joined the party of firms blacklisting Huawei Technologies’ equipment. US, Chinese and European markets, in particular, took the biggest hits as relations between the squabbling superpowers deteriorated further, moving the prospects of a trade deal further out with Europe precariously caught in the middle.
The S&P 500 index closed 0.66% lower on the day, dragged down by a sea of red across the markets. Tech stocks were among the worst affected by the fallout with the semiconductor sector and a number of prominent tech ETFs leading the charge lower. On average the US tech sector sagged 1.8%, with big names like Apple, Tesla and Alphabet sinking 2-8%, while Europe plummeted 2.8% for its biggest one day loss since January.
On the flip-side, defensive sectors, such as utilities, healthcare and consumer staples were the best place to be during yesterday’s sell off. Investors also flocked to the Dollar and Bitcoin (would you believe it?) for safe haven from a weak stock market.
Investors will be watching closely for further signs of weakness in the tech sector. Another tough day could lead to more distress in global markets and fears of a deeper slowdown than was expected.
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