NASDAQ declined for the third straight session
Tech stocks and broader markets have been on a roll this year despite risks. However, the tech-heavy NASDAQ Composite Index (QQQ), as well as the broader S&P 500 Index (SPY), fell for the third consecutive session on Wednesday, March 6.
While SPY fell 0.65% on Wednesday, QQQ fell 0.93%. The NASDAQ Composite Index is on course to have its first weekly decline in 11 weeks. The bull market, heading into its tenth anniversary on March 9, is a bit long in the tooth. The current Shiller PE ratio is 30.29x, which is very high, historically speaking.
Markets have more headwinds than tailwinds
More signs of slowing global economic growth—especially in China and the United States—and uncertainty over US-China trade tensions are also weighing on the markets. Plus, several tech companies have announced weak outlooks for 2019.
The stock markets, especially the tech sector, aren’t likely to see the kinds of returns they saw over the past few years. As we’ve mentioned before, the tech sector is unlikely to rise much from its current levels.
Even though broader markets have risen lately, returns on tech giants like Facebook, Apple, Amazon, Netflix, Google, and Microsoft have been mild at best.