As markets tumble, tech stocks hit a rare and ominous milestone

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When it comes to the stock market, America’s technology giants have become a harbinger of more pain to come.

If Facebook, Apple or Google looked shaky this year — as investors worried about growth, regulation or mismanagement — the rest of the market felt it. In recent weeks, as these companies have succumbed to concerns about the global economy, slowing profits or privacy concerns, they have led the decline in stocks.

Now, technology companies are dragging stocks into an ominous territory that investors have not seen in nearly a decade: a severe decline known as a bear market.

The Nasdaq index — Wall Street’s most technology heavy major benchmark — closed on Friday down more than 20 percent from its August peak, meaning it has officially entered a bear market. The S&P 500 and Dow Jones industrial average, both of which also include the biggest tech companies, are not far behind.

The Nasdaq is not the only the part of the market in such distress. The Russell 2000 index, which tracks shares of smaller companies, entered a bear market earlier this week. Seven of the S&P 500’s 11 industrial sectors are also at the level, led by energy stocks, which are down 28 percent from their highs earlier this year. That’s in large part because crude oil has been in a bear market since November.

Bear markets in stocks are rare but have the power to spread gloom through the economy. In the last 20 years, there have only been two — one that began with the financial crisis in 2007, and the other that started with the dot-com bust in 2000. Market downturns can gather steam even without strong evidence that economic and corporate fundamentals are weakening.

https://www.msn.com/en-us/money/markets/as-markets-tumble-tech-stocks-hit-a-rare-and-ominous-milestone/ar-BBRhst6?li=BBnb7Kz