The Lemon Fool

If you believe that bellweather stocks are a good indicator for the overall health of the market, then we seem to be heading into deep trouble as the FANGAM stocks are in the process of collapsing like dominoes.

It started with NFLX, then FB, then AMZN & GOOG.. everyone has crowded into the 2 largest - AAPL and MSFT, which in turn are doing their best to hold up the indexes, but surely it's just a matter of time before they too buckle.

I read an article years ago that suggested that certain tech stocks with an advertising model vastly out-scaled the advertising budgets of the remaining companies.
It stuck in my head.
Apple and Microsoft don't quite run along those lines, so maybe sense is returning.

I happen to work in logistics and I have been bemused by Aamzon's insistence on parking its tanks on our lawn recently. It has always been a crap industry to work in because scale is capital and wages intensive.

W.

vand wrote:If you believe that bellweather stocks are a good indicator for the overall health of the market, then we seem to be heading into deep trouble as the FANGAM stocks are in the process of collapsing like dominoes.

It started with NFLX, then FB, then AMZN & GOOG.. everyone has crowded into the 2 largest - AAPL and MSFT, which in turn are doing their best to hold up the indexes, but surely it's just a matter of time before they too buckle.

Interesting that you consider those stocks as "bellweathers". I'm not sure I would consider them as such and I doubt I am alone.

Not everyone has crowded into those 2 stocks mentioned either.

Think back to 1999-2000. What shares fell the most then?

There have been quite a lot of shares that have risen this year, plus a lot that have fallen. Here is my portfolio showing the price change for the year to date:

Epic     Change    Yield 
SHEL      37.67%    3.31%
BA.       35.65%    3.37%
PSON      23.42%    2.71%
BP.       22.53%    4.09%
BATS      20.96%    6.60%
AZN       18.07%    2.07%
TATE      15.66%    4.07%
S32       15.21%    4.12%
BHP       14.50%   10.11%
NG.       12.05%    4.19%
SSE       10.43%    4.55%
GSK        8.64%    2.82%
VOD        5.77%    6.40%
RIO        5.54%   14.58%
IMB        3.71%    8.42%
BT.A       2.57%    4.33%
UU.        0.23%    4.02%
RKT       -0.69%    2.76%
AV.       -1.07%    5.48%
TSCO      -4.38%    3.96%
CPG       -4.45%    0.89%
ULVR      -6.21%    3.98%
DGE       -7.98%    1.98%
PHP       -8.52%    4.72%
BLND      -9.60%    3.54%
IGG       -9.96%    5.94%
LLOY     -10.90%    4.72%
SMDS     -17.59%    4.15%
MARS     -17.60%    0.00%
LGEN     -19.83%    7.84%
SGRO     -23.77%    2.26%
KGF      -27.67%    5.12%
ADM      -27.81%   12.13%
IMI      -28.23%    1.89%
TW.      -30.60%    7.14%
MKS      -41.94%    0.00%

Av.Chg    -1.28%    4.67%

With dividends received, my portfolio is up +0.08% on the year to date.

TJH

From the BBC -

Apple loses position as most valuable firm amid tech sell-off -

Apple has lost its position as the world's most valuable company amid a broad sell-off of technology stocks.

Saudi Arabian oil and gas producer Aramco has reclaimed the top spot from the iPhone maker for the first time in almost two years. Investors have been selling shares in technology firms as they move into what they see as less risky assets.

Bitcoin, other major cryptocurrencies and digital assets have also continued to fall sharply.

Shares in Apple fell by more than 5% in New York on Wednesday to end the trading day with a stock market valuation of $2.37tn (£1.94tn). That meant it lost its position as the most valuable company in the world to oil and gas producer Aramco, which was valued at $2.42tn.

The move out of what are seen as risky assets also helped to push the price of Bitcoin below $28,000. The world's biggest and best-known cryptocurrency has now lost about 60% of its value since hitting a record high in November last year.

Ether, the digital coin linked to the ethereum blockchain network, also fell sharply again and has now lost around a third of its value in the last week.

https://www.bbc.co.uk/news/business-61417982

It's clear that many of the tech-related stocks that benefited from the COVID-related lock-down years were going to see an impact when things opened back up again, but for that to now also occur at a time when such huge inflationary pressures are also being seen, related to much more essential purchases such as food, fuel, and broader energy-related areas, as well as heading into a period of rising interest rates at the same time, then it's clearly putting huge pressure on many of the areas of digital-based discretionary spending that have benefited these types of companies in recent years.

Cheers,

Itsallaguess

I wonder how Buffett will be feeling about Apple now?

Dod

vand wrote:If you believe that bellweather stocks are a good indicator for the overall health of the market, then we seem to be heading into deep trouble as the FANGAM stocks are in the process of collapsing like dominoes.

It started with NFLX, then FB, then AMZN & GOOG.. everyone has crowded into the 2 largest - AAPL and MSFT, which in turn are doing their best to hold up the indexes, but surely it's just a matter of time before they too buckle.

However, the big question is... how did your trades in Zoom and Peloton work out? Remember our discussion at the end of January when you called me a troll. Hopefully my intervention saved you a few bob.

Dod101 wrote:I wonder how Buffett will be feeling about Apple now?

Dod

My guess = Extremely relaxed and considering if there's an opportunity to buy even more Apple stock in the sales.

simoan wrote:

vand wrote:If you believe that bellweather stocks are a good indicator for the overall health of the market, then we seem to be heading into deep trouble as the FANGAM stocks are in the process of collapsing like dominoes.

It started with NFLX, then FB, then AMZN & GOOG.. everyone has crowded into the 2 largest - AAPL and MSFT, which in turn are doing their best to hold up the indexes, but surely it's just a matter of time before they too buckle.

However, the big question is... how did your trades in Zoom and Peloton work out? Remember our discussion at the end of January when you called me a troll. Hopefully my intervention saved you a few bob.

I didn't buy them.. not because of our discussion. It's not the right time and I think tech stocks have further to fall before they're objectively cheap rather than relatively cheap. But I asked the question because... it was worth asking.

Not interested in PTON, but I do think ZM is a market leading product.

Signs that tech is reaching bubble levels again, after year of AI mania has driven prices to record levels

"Technology relative to the S&P 500 is at the late 1999/early 2000 level, just before the Tech Bubble burst and a nasty bear market began.

The "Magnificent 7" will soon become atrocious.

A credit event is coming."

Nvidia +236%
Meta +179%
Telsa 106%
Amazon 78%
Apple, Microsoft, Google +50%