The NASDAQ Composite and NASDAQ 100 Indexes led on the downside yesterday as volume increased significantly. Techs and other growth names were slammed on heavy volume. The S&P 500 and the Dow Jones Industrials Indexes were less maligned, and the Dow in fact closed positive on the day, up 0.09% or 22.51 points on about even volume. The NASDAQ has now posted two distribution days in a row off the peak.
There was no clear catalyst for the drop in technology stocks, but the industry has been the top-performing sector of the year by far with a number of large cap tech stocks serving as alt-currencies for fund managers who must keep up with their bogies while running low risk of being made redundant should names such as AAPL fall far from the tree.
“I don’t see any specific catalyst pushing tech lower, and it’s pretty quiet from the perspective of news about these stocks, which makes me think this is a classic sector rotation,” said Douglas DePietro, managing director for trading at Evercore ISI.
Futures are slightly higher at the time of this writing.Focus List Notes:AMZN
continued falling away from the $2,050 price level and the $1 trillion market cap level, falling back below the $2,000 level on heavy selling volume. It remains above its 10-dma.BZUN
continues to move lower on a retest of its 200-dma. While we do not believe the stock is currently buyable, it has held above its prior base breakout. The stock is not likely, however, to post any significant upside as long as weak Chinese markets continue to weigh on the stock.FTNT
broke hard off the prior day's all-time high on heavy selling volume. It remains above its 10-dma after an extended rally that began on a buyable gap-up move after earnings on August 2nd.SQ
also broke hard off its all-time high after posting 13 straight up days in a row. The stock remains above its 10-dma.
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