Apple shares tumble further
The biggest stocks across technology and the internet, including Apple and Facebook, resumed their descent as investors continue to fret that the one-time market darlings suddenly face a darker outlook for world growth.
The so-called Faanng stocks were among the biggest decliners of the day.
Facebook fell as much as 5.4% to the lowest since February 2017, while Netflix shed 5.2% and Amazon was off as much as 4.6%.
Apple fell 3.6% at one stage on a Wall Street Journal report that Apple recently cut production orders for all three of the iPhone models that were unveiled in September.
Meanwhile, sterling was little changed against the euro, at 89.06p, as last week’s political drama in Westminster over UK prime minister Theresa May’s future and that of the Brexit transition agreement calmed somewhat.
Fiona Cincotta, senior market analyst at City Index, said “traders will continue to focus on Westminster” even though the hearing with Bank of England governor Mark Carney at a parliamentary committee later today will be “a welcomed distraction”.
“Views on the UK economy are expected along with a grilling over the central bank’s plans for a no deal Brexit,” she said.
Of the Faang stocks, many remain strong performers for 2018 — Netflix is up more than 40% year-to-date while Amazon has gained 30%.
However, they have seen pronounced weakness in recent weeks, with selling spurred by some disappointing quarterly results and growth forecasts.
“You need to recalibrate your growth expectations,” said Frank Davis, director of sales and trading at Lek Securities.
“Investors had been looking past those issues before — if you weren’t in these names then you were missing out — but that pile-on mentality is gone, and the move out is brisk because the sentiment has changed so much,” he said.
Apple, the largest stock in the market, was on track for its sixth decline in eight sessions. It has dropped 20% from an early October record, on mounting concern for future iPhone demand.
Chip maker Nvidia tumbled again to shed almost half its value since early October. Other so-called momentum names seeing sharp moves included Square Inc and Salesforce.
Dropbox fell to a record low and Spotify dropped as much as 5.2%.
