Beautiful pictures; Chris Ratcliff | Bloomberg | beautiful pictures
Shares of Amazon and Google’s parents Alphabet just closed its biggest monthly decline since the 2008 financial crisis.
Both internet giants reported weaker-than-expected quarterly results this week, influenced by a combination of macroeconomic factors, the war in Ukraine and tough comparisons of financial markets. the number of failures in the pandemic.
Amazon fell 23.8% in April, the biggest drop since a 25.4% drop in November 2008, the same month that Google plummeted 18.5%. Alphabet had its worst month since then, falling 18% in April.
During the first few months of 2022, investors pivoted away from technology due to fears of rising inflation and higher interest rates. Russia’s invasion of Ukraine in February, the ensuing spike in fuel prices and ongoing labor shortages have already begun to hit corporate profits.
The last time Amazon and Google saw this type of sell-off was during the global financial crisis, when borrowers defaulted on their home loans at record levels and many leading financial institutions failed to pay off their mortgages. The head is failing. Lehman brothers fall in September 2008, followed by a series of massive Wall Street bailouts.
Tech stocks have been crushed across the board. Nasdaq fell 11% in November, after falling 18% in October.
It’s been a mixed bag for the big Tech class so far this earnings season. Facebook report profit was better than expected even though it had no revenue and told investors that second-quarter sales were likely to fall from a year earlier. Apple beat expectations, but Investors are terrified after warning that sales for the current quarter could suffer due to supply constraints.
On Thursday, Amazon gave guidance is weak for the current quarter and growth has stalled at its lowest level since the 2001 dot-com bust. Earlier in the week, Google miss in terms of sales and profits, reported a major shortfall in the YouTube segment, where revenue grew only 14%.
While both stocks are taking a hit this year, their trajectories have diverged significantly into 2021. Alphabet is Big Tech stocks perform best of the year, up 68%. Amazon is worst in the packup 2.4%.
SENTRY: Not much confidence in tech stocks right now, says Brent Thill of Jefferies
