Tech Stocks Continue to Tumble, With Precious Few Exceptions The Entrepreneur Index™ had another rough day on Tuesday.
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It's still rough out there.
Investors bought NVIDIA Corp. on the dip today, sending the share price up 3.03% after it shed nearly 30% of its value in the previous two trading sessions. The stock was one of only nine to post gains on the Entrepreneur index today. The index closed down 1.11%.
The nearly 50% drop in NVIDIA's share price since the beginning of October is emblematic of the reversal in investor sentiment on high growth technology stocks. Since its founding by CEO Jensen Huang in 1993, NVIDIA has become one of the hottest semiconductor chip makers in the world, with its products enabling the gaming graphics and artificial intelligence applications that are growing fastest in the market. The bounce today is encouraging, but it may not stem the slide if sentiment continues to sour.
High growth stocks -- and more particularly their high valuations -- are scaring investors in a market that has rapidly lost momentum. The technology heavy Nasdaq composite index (-1.7%) was down again today, though that was less than the Dow 30 index, which was off 2.21%, putting it into negative territory for the year. The S&P 500 was down 1.82%. The Nasdaq is now off almost 15% from its record high set in August.
Other tech stocks on the Entrepreneur index were mixed with Alphabet Inc. (0.56%) and Facebook (0.67%) posting small gains, while Amazon.com (-1.11%) and Netflix (-1.34%) had declines. Twitter was down 3.16%.
Chipmaker Analog Devices, up 4.09%, had the biggest gain in the sector and on the Entrepreneur index for the day. It beat earnings and revenue estimates with fourth quarter financial results reported this morning.
L Brands also beat earnings estimates and hit sales targets but was slammed in the market. The shares were down 17.71%, the biggest decline on the index today. The maker of Victoria's Secret lingerie cut its dividend in half and appointed a new head of its lingerie division. Sales at Victoria's Secret have fallen in seven of the last eight quarters and L Brands' stock is down 53% this year.
Other retailers on the index also saw major selling pressure as Target Corporation reported bad third quarter financials this morning. The company blamed rising wages, shrinking margins and swelling inventories for its poor results. Walmart (-2.71%), Dollar Tree Inc. (-3.24%) and Costco Wholesale Corp. (-4.12%) were all down sharply.
Comcast, which has been on a roll since reporting strong earnings at the end of last month, was down 3.72%. The shares of most media companies fell today after Amazon.com put in a bid for the 22 regional sports networks being sold by Disney Corp. The tech giant could make serious waves in the most prosperous programming segment of the market for traditional media companies like Comcast. Oil and gas producer Hess Corp. was also down sharply. The price of crude oil's steady decline over the last six weeks kicked into a higher gear today, falling nearly 7% and setting a new 52-week low. Hess' stock is still up 15.6% this year.
Just nine out of 60 stocks on the Entrepreneur index had gains today. Alexion Pharmaceuticals, up 1.53%, was the only one other than Analog Devices and NVIDIA Corp. to rise by more than 1%.
The Entrepreneur Index™ collects the top 60 publicly traded companies founded and run by entrepreneurs. The entrepreneurial spirit is a valuable asset for any business, and this index recognizes its importance, no matter how much a company has grown. These inspirational businesses can be tracked in real time on Entrepreneur.com.
