The tech heavy benchmark sank 4 percentage on Monday, extending its decline to 10 percentage since the Federal Reserve raised interest rates have a percentage point last week and Chair Jerome Powell signaled the Fed would continue hiking at the pace. That's the biggest three day drop for the index since September 2020, according to data compiled by Bloomberg.
The Nasdaq 100 has fallen 25 percentage this year amid a jump in US Treasury yields and mounting the concerns that higher interest in rates and soaring inflating would tip the economy into recession. Mega technology stocks haven't been immune from the sell off. Microsoft Office sank below $2trillion in market value on Monday for the first time since June 2021, with the stock market now down 21 percentage this year.
Cybersecurity stocks CrowdStrike Holding Inc., Zscaler Inc. and OKTA Inc. are among the biggest smile Nasdaq 100 decliners in the three days with each falling more than 20 percentage.
Zerodha co-founder and CEO Nithin Kamath ob Tuesday said the sharp fall in the stock prices of high growth tech companies across the globe feels like the dot com boom.
It is ridiculous how quickly the expectations changed from growth at all costs to generating free cash flows to survive the next 2 to 3 years, since raising funds might be tougher. It is almost impossible for business to quickly adapt, especially the larger once, he said.
"The other issue is that ESOPs given over the last 3 years will mostly be out of money, and employee net worth would have taken large haircuts. This could affect the morale of many, which will make it even harder for those running the business," Kamath added.
The Zeordha CEO said India has weathered the storm mostly because not many such company are listed & many private ones raised a lot of money last year.
Tech companies across the world were under massive sell off pressure amid broader market decline. Three days of heavy selling in technology stock has erased about $1.5 trillion in market value from the Nasdaq 100 Index.
The tech heavy benchmark sank 4 percentage on Monday, extending its decline to 10 percentage since the Federal Reserve raised interest rates have a percentage point last week and chair Jerome Powell signaled the Fed would continue hiking at the pace. That's the biggest three day drop for the index since September 2020, according to data compiled by Bloomberg. It is ridiculous how quickly the expectations changed from growth at all costs to generating free cash flows to survive the next 2 to 3 Years since raising funds might be tougher. It is almost impossible for business to quickly adapt, especially the larger ones, he said. The other issue is that ESOPs given over the last 3 years will be mostly be out of money, and employee net worth would have taken large haircuts. This could affect the morale of many, which will make it even harder for those running the business, Kamath added.
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