Author Topic: STOCKS COLLAPSE NASDAQ PLUNGES 3%  (Read 347 times)

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Online mystery-ak

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« on: April 10, 2014, 04:50:06 PM »

Stocks derailed by high-flyers; worst day since 2011 for Nasdaq
Kate Gibson   | @CNBCKateGibson
41 Mins Ago

Pisani finds silver lining
CNBC's Bob Pisani reports on Caterpillar and IBM's growth this year, and whether the U.S. is the best place to invest.

U.S. stocks were slammed on Thursday, with high-flying technology and biotech shares leading the declines that had the Nasdaq Composite posting its worst session in more than two years.

"The market is coming to its senses in some of the high-flying tech names; it looked like there were some pretty hefty amounts being paid for the prospect of eventual earnings. Any of us in the market more than 15 years feels the hot breath on the backs of our necks when we see such high prices being paid for tech stocks," said Jerry Webman, chief economist at Oppenheimer Funds.

"One of the interesting ironies is when you see a shift towards stocks with pretty low prices and away from momentum that tends to happen when the underlying economy is still growing," Webman added.

The Nasdaq Composite declined as much as 141 points, and ended down 129.79 points, or 3.1 percent, at 4,054.11, its hardest hit since November of 2011.

Momentum stocks including Tesla Motors, Facebook, Google, Priceline Group and declined, along with biotechnology companies, with Pacific Biosciences of California, Zogenix and ChemoCentryx among those hit.

"Clearly investors are nervous about high-flying momentum stocks. There is a rethink on whether better earnings and economic data will support a resumption of the momentum that was driving biotechnology and higher-flying technology stocks earlier in the year," said Kate Warne, investment strategist at Edward Jones.

"We're back to a valuation focus; investors are gravitating towards something tangible, like earnings and revenue," said Jack Ablin, chief investment officer at BMO Private Bank.

"We're entering earnings season and they are not going to have much to show. Investors want to see earnings and cash flow," said Ablin of new technology and biotech firms that have seen their shares run-up on bets for future performance.


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Online sinkspur

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« Reply #1 on: April 10, 2014, 05:55:12 PM »
The Fed is not going to shut off the spigot any time soon.  The economy is way too sluggish.


It's far easier to dupe people than to convince them they have been duped.

Offline Chieftain

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« Reply #2 on: April 10, 2014, 06:03:37 PM »
Perhaps this is a result of investors' concerns about how soon, and how quickly, the Fed is going to turn off the free money spigot?  When there's free money to be had, momentum stocks would be a better pick because the value therein lies in the market psychology of greed.  But when the free money goes away, the smart investor doesn't want to be left holding the bag, a portfolio of now inert, and thus valueless, momentum stocks, but rather something that has some more identifiable, real, value behind it.

A lot of these stocks have been overpriced for some time, based on long-term speculation (re: SWAG of Scientific Wild-Assed Guess...) about what a company might or might not do.  Lots of investors are beginning to spit out the Kool-Aid and retreating back into safer territory. 

And let's not forget that the majority of the trading going on these days is computer driven and computer enhanced.  The days of monitoring what individual investors are doing went the way of the dinosaurs some time ago....

Offline truth_seeker

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« Reply #3 on: April 10, 2014, 06:19:20 PM »
The "Taper" by the Fed has already been factored into the market already.

Fluctuations are normal.

The US market is still one, if not the safest places to store and build wealth.

In 1987 I made the mistake of panicking and selling a couple of stocks when the market fell off the table.

Had I done nothing the market would have bounced back in a few months.

Novice mistake. Learn from your mistakes. Quit handing your broker easy commissions (which he will gladly accept).


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