The backdrop for tech stocks is outright ugly and likely to stay that way in the near-term, warns one closely followed sector analyst.
“A perfect storm continues to brew for big tech,” said Wedbush tech analyst Dan Ives. “This year so far has been a brutal tape for tech investors as valuation compression, risk-off mentality, and a “nowhere to hide” feel has seen many core tech names down 30%-40% from highs with high flyers/high beta names down 60%+. From a high level, it’s the most oversold we have seen tech stocks relative to its valuations/growth prospects in over five years with this unmitigated surge of the Street heading for the exits.”
Ives explains investors have rotated out of tech amid concerns about the Russian war on Ukraine, fears of rising interest rates (often not good for tech investors) and “chaos” around China’s zero COVID policy (see Foxconn plant closure on Monday…
