Tech giants face stock decline while bond market remains strong

  • Stocks of the ‘Magnificent Seven’ group have performed poorly in 2024
  • Investors are buying bonds of the ‘Magnificent Seven’ companies
  • Net buying of bonds over the last three days
  • Spreads to Treasurys have slightly widened
  • 10-year Treasury yield has climbed above 4%
  • Stocks have started the year on a negative note
  • Apple down 5.5% after downgrades from Barclays and Piper Sandler
  • Concerns about valuation and pressures in the smartphone market
  • Nasdaq Composite down for a fifth straight day

The stocks of the ‘Magnificent Seven’ group of big tech companies have performed poorly in 2024, with Apple leading the decline after downgrades from Barclays and Piper Sandler. However, investors seem unfazed as they continue to buy bonds issued by these companies. Over the last three days, there has been net buying of bonds, despite slightly wider spreads to Treasurys. The 10-year Treasury yield has climbed above 4%, but these quality names still offer attractive yields. The Nasdaq Composite is also experiencing a downward trend, marking its longest losing streak since October 2022. Overall, while stocks struggle, the bond market remains strong for the ‘Magnificent Seven’ companies.

Public Companies: Tesla Inc. (TSLA), Amazon.com Inc. (AMZN), Apple Inc. (AAPL), Microsoft Corp. (MSFT), Nvidia Corp. (NVDA), Alphabet Inc. (GOOGL), Meta Platforms Inc. (META)
Private Companies:
Key People: Harsh Kumar (Piper analyst), Tim Long (Barclays analyst)

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Factuality Level: 7
Justification: The article provides information about the performance of the stocks and bonds of big tech companies. It includes data and charts to support the claims. However, it lacks in-depth analysis and context about the factors influencing the performance of these companies.

Noise Level: 3
Justification: The article provides information on the performance of the ‘Magnificent Seven’ big tech companies’ stocks and bonds. It includes charts showing flows and buying breakdown by client type. It also mentions downgrades and concerns about valuation and smartphone market pressures for Apple. However, the article lacks in-depth analysis, evidence, and actionable insights. It mainly focuses on stock performance without exploring the consequences or providing a broader context.

Financial Relevance: Yes
Financial Markets Impacted: The article pertains to the performance of big tech companies’ stocks and bonds, which can impact the financial markets and investors.

Presence of Extreme Event: No
Nature of Extreme Event: No
Impact Rating of the Extreme Event: No
Justification: The article discusses the performance of big tech companies’ stocks and bonds, indicating financial relevance. However, there is no mention of any extreme events or their impact.

Reported publicly: www.marketwatch.com www.wsj.com