For weeks, warnings that elevated tech-stock valuations could cause a violent selloff bubbled beneath the surface. On Wednesday, they looked prescient.
U.S. stocks tumbled the most since June with rising virus cases threatening the economic recovery. More than $2 trillion has been wiped from the value of American equities this week and Wall Street’s fear gauge spiked to the highest in four months.
Big tech companies from Apple to Amazon led the rout, their shares having gotten so expensive relative to expected earnings that further price gains became hard to justify. Software giant SAP SE set off alarms on future profit when it warned revenue would suffer well into 2021. A day later, U.S. tech darlings exacerbated market volatility for the second time in two months after a summer of gains that outpaced the broader market’s advance by 10 times.
“There’s uncertainty around the coronavirus surrounding the impact of another … Read More