Microsoft Inspired Tech Sell Off
Microsoft Corp. warned about a slowdown in sales, causing stocks to slump and fueling concern that even the technology industry is getting hit as the economy cools. The Nasdaq 100 is on track for its worst rout in a month, and shares of software giant Microsoft tumbled more than 4%. Fourth-quarter earnings for tech firms in the S&P 500 are projected to drop 9.2% from the same period a year earlier, the steepest slide since 2016. Other companies such as Texas Instruments and Boeing also reported losses. The New York Stock Exchange had a manual error that caused wild price swings and trading halts for hundreds of company stocks when the market opened on Tuesday, but the issue has been resolved.
Cloud Stocks Taking the Brunt
Cloud stocks refer to companies that provide cloud computing services, such as Amazon Web Services (AWS), Microsoft Azure, Google Cloud, IBM Cloud, and Salesforce. Other companies that offer cloud-based products and services, such as software and infrastructure, can also be considered cloud stocks, such as Adobe, Dropbox, and Zoom.
This stocks have been seen as high growth stocks, and when the markets go sour, they tend to get a lot of downside pressure, which is what we are seeing today after Microsoft’s earnings which dampened sentiment.
Investors are now fearing for worse than expected earnings reports from these high growth technology companies.
However, this could be an opportunity to buy the dip, and take advantage of these tech stocks on “sale:
The stocks taking the worst of the down kicking are Snowflake, Cloudfare, Cloudstrike, Amazon, Telsa, Zscaler, which are all getting hit today as a result of Microsoft’s outlook.
However a lot of traders and investors are speculating that interest rates are nearing their high, and the tide could finally be changing for stocks after after years miserable performance.
Many believe 2023 is the year that Mainstreet suffers while Wallstreet recovers!