At what point does the slump in US technology stocks stop being dismissed as a mere “tech wreck” primarily centred on the most speculative companies and become considered a fully-fledged dotcom crash 2.0?
The combination of increasingly hawkish central banks and Russia’s invasion of Ukraine has been toxic for equity markets this year. The MSCI All-Country World index is now down 12 per cent in 2022. However, as is often the case, headline indices miss a more fascinating story underneath.
The pain has been primarily focused in US technology stocks. Despite a tepid bounce over the past week, the Nasdaq Composite index has already fallen nearly 20 per cent in 2022. In dollar terms, the tech-heavy market has now lost well over $5tn in value since its November peak — more than the Nasdaq’s dollar losses through the entire dotcom bubble unwinding in 2000-02.