Equity markets look set for a lower open Tuesday as technology stocks continue to get hammered.
Dow Jones Industrial Average futures have dropped 270 points, or 0.8%, while S&P 500 futures have fallen 1.2%, and Nasdaq Composite futures have slumped 1.9%.
Weakness in tech stocks won’t let up. The Nasdaq fell 2.5% Monday as investors favor more economically sensitive stocks. The reason: The sharp economic recovery will drive faster earnings growth for those stocks than for tech.
The other concern for tech stocks is valuation. Growth companies, many of which are in the technology space, are trading at higher multiples of near-term earnings than value stocks by a wider margin than that often usually seen over the past 10 years, according to Credit Suisse data. “Valuations in tech stocks are disconnected from reality and the decline in tech stocks is simply the removal of froth from valuations,” writes David Bahnsen, chief investment officer of The Bahnsen Group.
Here are five stocks making moves in Tuesday’s premarket action:
Palantir Technologies (PLTR) stock fell 10% after reporting a profit of 4 cents a share, in line with forecasts for 4 cents a share, on sales of $341 million, above expectations for $332 million.
Tyson Foods (TSN) stock dropped 1.9% after getting downgraded to Neutral from Overweight at Piper Sandler.
BioNTech (BNTX) stock dropped 4% after getting downgraded to
Neutral from Buy at Bryan Garnier.
Nike (NKE) stock gained 1% after getting upgraded to Buy from Hold at Jefferies.
Dow Inc. (DOW) stock dropped 2% after getting downgraded to Neutral from Buy at Goldman Sachs.
Write to Jacob Sonenshine at [email protected]
