Tech stocks bore the brunt of US election results for the fourth consecutive day amid possibilities of trade war with China. Investors are expecting a tough strategy with China under Trump presidency. This could lead to stiff tariffs on products imported from China, resulting in a fall in sales.
Tech giants take a beating
Tech giants like Apple, Facebook, Amazon and Alphabet are down severely since election results were declared and Trump emerged the winner on Nov 8.
Apple shares led the lot, falling 2.5 per cent on Monday after a report in a government-controlled newspaper in China warned that “iPhone sales will suffer a setback” if Trump continues with his campaign threats to ‘wreck’ US-China trade relations. Apple selloff came in spite of pleas from analysts that the company could be the biggest beneficiary of Trump’s proposal to dangle tax breaks for companies looking to repatriate their holdings. Apple holds more than $230 billion in cash overseas.
The Chinese ecommerce giant, Alibaba, was also among those battered as shares of the NYSE-listed company fell 3.5 per cent, down more than 10 per cent since Election Day.
Shares of Amazon lost 2.7 per cent on Monday, to close at $719.07. The e-commerce giant is down 8.7 per cent since Trump’s election resulting in the company losing nearly $6 billion. Jeff Bezos, the company’s billionaire boss, is now left with just $62.9 billion.
Meanwhile, shares of tech companies like Facebook and Google parent Alphabet were slammed simply because money managers left them for greener pastures (Trump-friendly sectors) of banks, pharmaceuticals and defence.
Other big names which were hit hard, included Tesla Motors and SolarCity.
As portfolio manager at Jensen Investment Management, Kevin Walkush put it: “It appears to be a bit of a rotation among sectors”.