Tech stocks slide, oil price higher
Growth and technology stocks led a Wall Street rout last night as the darkening economic outlook caused investors to take cover.
The Nasdaq fell almost 4% to a one-year low and the Dow Jones Industrial Average S&P 500 lost more than 2% during another session of volatility. Apple and Amazon shares fell 4% and Tesla slumped 12% on fears that Elon Musk may have to offload some of his stake in the electric car marker in order to finance the Twitter takeover.
The Nasdaq is now down by more than 20% this year and by 10% in April, which is usually a strong month for the tech-led index.
Analysts at Nordic bank SEB said: “Concerns about growth, interest rates, component shortages, and investment prices are some of the heavy clouds that are currently hanging over equity markets.”
Hopes of a rebound in today’s Wall Street session have been dashed by a mixed reception to results after the closing bell from Microsoft and Alphabet. The Google owner missed its earning estimates, leaving shares a further 3% lower in after-hours trading.
Michael Hewson, chief market analyst at CMC Markets, expects the FTSE 100 index to open 10 points lower at 7376, having surrendered most of the gains achieved in the early part of yesterday’s session.
He said the weakness partly reflected a lack of confidence in the ability of central banks to engineer a “soft landing” as they tackle inflation.
The Brent crude price, meanwhile, is higher at $105 a barrel after a spike caused by Russia saying that it would cut natural gas supplies to Poland and Bulgaria.