Markets stocks

Tech Is A Bubble Again. Sorry.

It's pretty glaring, folks.

Tech stocks are on fire. Perhaps you noticed. 2020 is starting to look suspiciously frothy on any number of fronts, and although you can always argue that one corner is more bubbly than another, it would be entirely fair to say that big-cap tech is at least as "guilty" as anybody when it comes to being the poster child for what may, in hindsight, be regarded as a "blow-off top" moment. Alphabet joined the $1 trillion club this week and on one measure, the Nasdaq 100 is very nearly the most overbought since the tech bubble. You can conjure any number of amusing visuals to illustrate the same point, but we would also note that big-cap tech has now outperformed the S&P for six consecutive weeks. That is the longest such streak in two years, and it's pushed multiples to extremes, leading to even more outsized representation for the behemoths. As mentioned last week, Apple, Microsoft, Alphabet, Amazon and Facebook now comprise 18% of the S&P 500's market cap, the most ever. (Morgan Stanley) Just how detached are tech shares these days? That depends on who you ask. Morgan Stanley's Mike Wilson has been relatively bearish on tech since the summer of 2018, when he cal
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1 comment on “Tech Is A Bubble Again. Sorry.

  1. Anonymous says:

    30-40% of the SP500 is probably in secular decline. Of those that are left growth is low in many areas and health care will eventually be pressured. So a dearth of growth (not that AAPlL is growth) pushes everyone into tech.

    It is a sign of troubles in other sectors in addition to excess liquidity that are leading to the excesses.

    GOOGL in innovating in amazing ways. AAPL and FB not really.

    But if you want mispricings look at Utilities and bonds of all stripes.

    I’ll take my risks with GOOGL rather than owning a utility for the next 10 years.

    But no doubt tech and pretty much everything else is grossly overvalued. Nasdaq hasn’t even doubled from the early 2000 peak. I remember the infous (and insane) Nasdaq 5000 bubble daze…………..

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