Deciphering the FAANG phenomenon

The Business Times
View From The Top
Published: 26 June 2017

 
Is the recent technology sell-off a one-off correction or does it portend sustained and broader weakness beyond the tech sector?

WE could read the latest technology sell-off as a reflection that technology companies are overvalued and the industry is a bubble.

Or, it could be a one-off correction, with investors profit-taking before pushing the market higher. It is hard to predict at this point.

That said, with solid earnings expectations of the big tech names, it is possible that the prognosis is tipped slightly in favour of the latter.

There are, however, many other factors to consider. For one, how will the recent interest rate hike against the backdrop of weak economic data impact global markets? We will need to see how this plays out.

Ronald Lee
Managing Director
PrimeStaff Management Services Pte Ltd

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