Investors are pouring money into surging “super-cap” tech stocks, but the rest of the market is showing signs of weakness.
Despite growing concerns about a record number of new U.S. coronavirus cases, the stock market has largely held steady thanks to surging shares of big tech companies—though that’s resulting in a very imbalanced market, experts warn.
Shares of big tech companies such as Amazon, Microsoft, Apple, Netflix and Google-parent Alphabet have all led the market higher in recent weeks thanks to the fact they’ve been doing relatively well amid the coronavirus pandemic, with earnings holding up much better than most other industries. Beyond sporting “ultra-solid balance sheets,” super-cap tech companies have also been able to more quickly adapt to the pandemic by instituting “virtual” models and shifting employees to remote working, Crisafulli says.so far this year and rising to a new record high of more than $1,500 per share.when it met with civil rights groups earlier this week, but investors didn’t seem to care: The stock continued to trade well as investors remain obsessed with tech stocks.
“A huge rotation is underway as investors shift into super-cap tech and shun those groups most sensitive to underlying economic fundamentals ,” Crisafulli says.“Trying to argue things like ‘fundamentals’ or ‘valuation’ with the types of investors bidding up AAPL, AMZN, MSFT, etc., several percent every session is a waste – those quaint notions just aren’t entering into the conversation right now,” says Crisafulli.
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