Have Investors Fallen Out Of Love With The Tech Giants?

Shares in Facebook, or Meta Platforms Inc as it is now called, fell by a quarter last week, and have continued their decline since then. Indeed, they are one-third down so far this year. That’s partly a specific Facebook story, a function of the decline in the number of active users, and one that has been given a further twist by the latest row with the EU.

- Hamish Mcrae

But it is also a market story more generally. Other US technology shares have been weak so far this year. Netflix is down by one-third, Tesla by a quarter, Twitter and Peloton by 15 per cent. Even Amazon, despite the business doing very well, is down by 7 per cent, while Microsoft is down 10 per cent and Apple, the most valuable company in the world, is down by nearly 5 per cent.

Cross the Atlantic, and a quite different picture emerges. In London, relatively few high-tech companies are quoted, with the FTSE100 share index heavily weighted to oil companies, banks and consumer goods suppliers. It is actually up a bit this year, by contrast to the Nasdaq index in New York, which is down 12 per cent. Indeed, London and Hong Kong are about the only major share markets that are up so far this year, with both Paris and Frankfurt down.