Technology stocks in Canada and the US are being absolutely hammered. The NASDAQ has dipped below 4000 this morning. My Sierra Wireless shares, which peaked at $232 earlier this year, are trading at $70 (I bought at $22). Everybody’s talking about a cascade failure in tech stocks. I’ve heard of people losing 80% of their portfolio’s worth. My RRSPs have lost roughly 45% of their value as of last Tuesday.
Is the growth spurned by sizzling markets and a trigger-happy investment public coming to an end? The sell-off continues at an accelerated pace, apparently sparked by the convenient excuse of another judgement against Microsoft.
One way to track the health of the technology industry is to watch the Big 7 (below). Undeniably most of the churn has happened at the bottom of the food chain — this is where most Canadian companies, like Sierra Wireless and RIM, live.
The biggest slaughter I spotted in the US (not an exhaustive search) among well-known companies was Exodus, who dropped to $96/share from $180 a couple of weeks ago. Yikes! PALM is trending toward a close at $34 today. Pity those people who bought at $165! I sold a while ago in the upper 50s.
Anyway, the Big 7 have weathered the storm pretty well, overall. Cisco is still smelling like a peach (yay!) and AOL is barely hanging on. Overall, though, an 88% total Cap reduction among the Top 7 isn’t all that bad… it’s really Microsoft that’s dragging down the average. Notice the precarious position of Yahoo! (yikes).
Mar. 22 April 4 Percentage Company Market Cap Market Cap of Prev.