Microsoft And Alphabet At 1 Years Low After Apple Rating Downgrade
During the Thursday trading session, shares of tech companies such as Microsoft and Alphabet were at a one-year low on account of Apple's rating downgrade. Considering the strong position of Apple among the big tech companies, it was only natural to witness a sell-off in the tech sector!
Recently, the Bank of America (BoA) analysts revised their ratings of Apple lower (from BUY to Neutral), which is now putting a drag on other tech stocks.
Investors Are Getting Ready For Possible Recession
Recent economic woes have pushed investors to move away from growth stocks and especially the tech sector. A lot of investors are now also adjusting their portfolios to account for a possible recession.
The Nasdaq index, which is tech-heavy, is also facing several weeks of consistent selling and is showing the negative sentiment of the investors. If we look at the S&P 500, it also fell by 2.1%, which further highlighted the current market situation.
After the analysis from BoA, Apple stock dropped by 5% - In the analysis, the current rating of Apple was changed from Buy to neutral. In trading terms, neutral means that the analyst is neither bullish nor bearish on the stock and usually warrants wait and caution.
One of the key factors which pushed this rating downgrade was the weak buying demand for the iPhone 14 released a few weeks ago. There are also reports on how Apple is no longer looking at plans to ramp production.
When compared with 2021, Apple has almost lost 20% of its value while the Nasdaq index is down by almost 31%! Both of these stories tell us that the tech sector is now feeling the pain after enjoying a bull run for years.
Google And Microsoft At 52 Weeks Low
Among all the tech companies, the one who took the lightest blow was Microsoft. By the end of Thursday's session, the stock was only down by 1.5% and had touched its 52-week low.
Alphabet (parent company of Google) also touched its 52-week low while Facebook lost 3.7% of its stock value. Tesla, which is involved in e-car manufacturing, also lost 6.8% of its value!