U.S. stocks staged a strong rebound just yesterday, but started falling again today.
On November 10, U.S. CPI came in above expectations. The Nasdaq fell about 1.25% intraday, while the S&P 500 dropped about 0.84%.
Nvidia plunged more than 5% at one point, and the yield on 10-year U.S. Treasury bonds rose to around 4.99%.
Over the past two years, valuations of AI tech stocks have been built on continued growth in capital spending and expectations for future earnings.
But if U.S. interest rates remain high, investors will need to recalculate the value of these companies’ future cash flows.
Nvidia is also facing controversies of its own, and its share price is being affected by both market conditions and company-specific events.
I don’t currently think that a one- or two-day rebound in tech stocks means this correction is over.
If the 10-year U.S. Treasury yield continues to rise above 5%, high-valuation tech stocks may face further selling pressure.
$QQQB $NVDAB $INTCB
On November 10, U.S. CPI came in above expectations. The Nasdaq fell about 1.25% intraday, while the S&P 500 dropped about 0.84%.
Nvidia plunged more than 5% at one point, and the yield on 10-year U.S. Treasury bonds rose to around 4.99%.
Over the past two years, valuations of AI tech stocks have been built on continued growth in capital spending and expectations for future earnings.
But if U.S. interest rates remain high, investors will need to recalculate the value of these companies’ future cash flows.
Nvidia is also facing controversies of its own, and its share price is being affected by both market conditions and company-specific events.
I don’t currently think that a one- or two-day rebound in tech stocks means this correction is over.
If the 10-year U.S. Treasury yield continues to rise above 5%, high-valuation tech stocks may face further selling pressure.
$QQQB $NVDAB $INTCB