Reported today in an article on Bloomberg.
Credit and thanks to Mr.David Fox for writing this very timely article. A big warning to everyone.
A bruising selloff in technology shares, sparked by a few days of disappointing tech firm results, drove the Nasdaq down about 10% from its peak, near a technical correction. It closed 2.9% in the red.
Intel plummeted 29% — the most in over four decades — as its outlook missed estimates. That news came on the heels of Alphabet’s biggest-ever market plunge the day before, in which it saw half-a-trillion dollars in market capitalization go up in smoke. And Amazon became the latest firm to face a sharp post-earnings selloff after the company reported greater capital spending than anticipated and the slowest growth in its core e-commerce business in three years.
As the central businesses of America’s technology giants — the advertising, consumer and retail machines that have propped up a collective $750 billion in artificial intelligence spending this year — show signs of slowing, investors are sharpening their scrutiny of whether the huge sums being poured into AI will pay off.
Concern is growing that the long-feared bubble will pop under the weight of what some consider the greatest misallocation of assets in history.
“We’re moving out of the hopes and dreams phase of the AI trade and into the ‘show me’ phase,” said Joe Tigay at Equity Armor Investments. This week at least, investors did not like what they saw. —David Fox
I don't wish to be claiming any credit but I have been warning about Fomo driven rallies for a long time. And whereas a lot of hopes was argued and promoted these few months, all around future growth of AI, it is also true to realise much of the price increases were pushed by retail investors. The Fomo crowd who are also the easiest to panic and run.
November is going to start off pretty bleak.
Again, I am taking money off to play safe. Please DYOD.
Disclaimer: Investing carries risk. This is not financial advice. The above content should not be regarded as an offer, recommendation, or solicitation on acquiring or disposing of any financial products, any associated discussions, comments, or posts by author or other users should not be considered as such either. It is solely for general information purpose only, which does not consider your own investment objectives, financial situations or needs. TTM assumes no responsibility or warranty for the accuracy and completeness of the information, investors should do their own research and may seek professional advice before investing.
