Benzinga - by Piero Cingari, Benzinga Staff Writer.
The collective market value of America’s tech behemoths—often referred to as the “Magnificent Seven”—witnessed a staggering $300 billion evaporation in the first hour of trading on Wednesday.
The group, comprising tech titans such as Apple Inc. (NASDAQ:AAPL), Microsoft Corp. (NYSE:MSFT), Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL), Amazon.com Inc. (NASDAQ:AMZN), Meta Platforms Inc. (NASDAQ:META), NVIDIA Corp. (NASDAQ:NVDA), and Tesla, Inc. (NASDAQ:TSLA), felt the seismic shockwaves of investor apprehension towards softer-than-expected earnings reports.
The broader tech market felt the group’s tremors, with the Nasdaq 100 index, tracked by the Invesco QQQ Trust (NYSE:SPY), sliding down 1.6% by 10:45 a.m. ET. This marked the biggest single-day dip since the outset of January. Similarly, the Technology SPDR Select Sector Fund (NYSE:XLK) regressed by 1.5%.
The primary culprits for Wednesday’s tech market plunge were lackluster earnings reports from Alphabet and Advanced Micro Devices Inc. (NASDAQ:AMD), casting some shadows over the once-bright prospects of AI-driven exponential growth.
Alphabet’s market valuation alone plummeted by $121 billion in the early trading hours, with an over 6% decline in its share price. NVIDIA wiped out $46 billion, while Apple saw its market cap trimmed by $42 billion.
Here’s a breakdown of the individual losses sustained by these tech giants within the first hour of trading Wednesday:
| Tesla, Inc. | $610.17B | $-5.45B | -0.89% |
| Meta Platforms, Inc. | $1,028.10B | $-18.48B | -1.80% |
| Amazon.com, Inc. | $1,643.11B | $-32.50B | -1.98% |
| Microsoft Corporation | $3,036.75B | $-38.87B | -1.28% |
| Apple Inc. | $2,907.45B | $-42.52B | -1.46% |
| NVIDIA Corporation | $1,550.52B | $-46.09B | -2.97% |
| Alphabet Inc. | $1,904.78B | $-121.22B | -6.36% |
Could The Fed Hasten The Tech Selloff?
Markets are on edge as they look forward to the announcement of the Federal Open Market Committee’s (FOMC) decision on interest rates, scheduled for 2:00 p.m. ET on Wednesday.Although the outcome seems almost certain, with the Fed is expected to keep interest rates steady at 5.25% to 5.50%, the focus of investors will be set on the insights Chair Jerome Powell‘s follow-up comments might unveil.
The technology sector is notably one of the most sensitive to fluctuations in interest rates.
Should the Federal Reserve counter the market’s expectations of nearly six rate cuts in 2024, it could unsettle investors, who are anticipating a more lenient monetary policy in the future.
Read now: All Eyes On Fed As Markets Brace For Powell’s Remarks On 2024 Rate Cuts
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