The US stock market was dominated by technology sales last week

Alphabet, Amazon, Apple, Microsoft or Meta Platforms. Usual US stock market drivers have launched a steep sell-off in recent days. He was extremely painful even for the world’s richest people, whose wealth was thus significantly reduced.

Tesla boss Elon Musk lost more than $ 25 billion, about 540 billion crowns, due to a drop in securities last week. Amazon founder Jeff Bezos lost about $ 20 billion, and Facebook owner Mark Zuckerberg lost $ 10.4 billion. Of the ten richest people on the planet, not only the French billionaire Bernard Arnault has lost money in recent days, but his wealth comes mainly from business in the field of fashion.

Who is Elon Musk?

Who is Elon Musk

Netflix shareholders are also having a hard time. The streaming giant, long considered one of the biggest pandemic winners, has apparently benefited from the coronary crisis and now has to fight growing competition.

The weak outlook for new subscribers’ growth in the first quarter of 2022, released by the company on Thursday, put Netflix’s securities deep. They handed over more than a fifth of their value on Friday, down 41 percent from its peak just two months ago.

Economists see the US central bank’s hawkish turnover as the main cause of the dramatic downfall of technology giants. The Fed’s leadership will discuss monetary policy this week and is expected to outline its plans for an upcoming rate hike. Goldman Sachs estimates that the Fed will raise the base rate at least four times this year.

Russian stocks are falling sharply.  Tensions between the West and Russia are escalating

However, there may be several reasons. “Of course, the omicron and escalating geopolitical risks also played a role. At the same time, the market is now full of hot start-up capital, which of course tends especially to the riskier and thus more interesting titles. As soon as things start to crumble, beginners are just going to have their hands shaken and the domino effect is coming, ”says Michael Kopta from the global brokerage company XTB.

“Technology stock ratings were very high last year, so the current correction is only bringing the market and investors’ expectations back to a more normal level,” added Finlord analyst Boris Tomčiak. According to Tomčiak, emotions currently prevail in the markets, which may trigger further panic sales in the short term, especially in the growth stock segment.

The market for virtual lands is growing rapidly, selling for tens of millions of crowns

“In the coming years, however, the revenues and profits of technology companies will continue to rise along with the expansion of the global economy. The current reduction in the price of these titles thus opens up an interesting buying opportunity for long-term investors, “says the analyst. The aforementioned Fed meeting should also contribute to a slight stabilization of stock exchanges. “It could reassure investors and show the direction the central bank’s policy is heading,” adds Pfeiler.

In addition to the securities of technology companies, cryptocurrencies have also weakened significantly in recent days. The value of bitcoin fell below $ 34,000 on Monday, the lowest since last July. “The total market capitalization of cryptocurrencies has fallen by $ 600 billion since the beginning of the year,” Pfeiler said. The fall of virtual currencies was also affected by several factors. For example, concerns about the Russian invasion of Ukraine or the growing regulation of cryptocurrencies in many countries around the world.