For the first time, all five FAANG stocks are in bear markets. Apple Inc.’s stock
made it unanimous Tuesday, as it tumbled 4.8% to the lowest close since May 3, helped there by a price target cut at Goldman Sachs. The stock closed 23.7% below its Oct. 3 record close of $232.07. Many on Wall Street define a bear market as a decline of 20% or more from a bull-market peak. On Monday, Apple’s stock dipped briefly into bear market territory, but pared losses to close 19.9% below its record. Read more about how Apple flirted with a bear market. Apple‘s last bear market started on Aug. 21, 2015, and didn’t end until Aug. 9, 2016. The stock fell as much as 32% during that downturn. Goldman analyst Rod Hall cut his stock price target to $182 from $209, citing concerns over “deteriorating demand,” following the technology giant’s disappointing holiday season guidance and revenue guidance cuts from multiple smartphone suppliers. Don’t miss: Opinion: When the going gets tough, Apple hides its numbers.
Apple bulls were the last among the FAANG technology darlings to capitulate. Google parent Alphabet Inc.’s stock
entered a bull market on Monday, when it closed 20.1% below its July 26 record of $1,285.50. The stock inched up 0.3% on Tuesday. Alphabet’s last bear market ended on Oct. 14, 2011, or a little less than three months after it started. During that selloff, the stock lost 21.1% at its bear-market bottom. Also read: Google parent Alphabet’s stock becomes 2nd FANG to produce ‘death cross’ and Netflix is next. Amazon.com Inc. shares
had entered a bear market on Oct. 29. With the stock shedding 1.1% Tuesday, it ended the day 26.7% below its Sept. 4 record of $2,039.51. Amazon’s previous bear market, in which the stock tumbled as much as 30.5%, ended on March 1, 2016, just four weeks after it started. Shares of Netflix Inc.
have been in a bear market since Oct. 24, which was just about three weeks after the previous one ended. Facebook Inc.
been in a bear market the longest, since July 30, or only about three months after the preceding bull market started. See also: Netflix’s ‘death cross’ is the third for FAANG stocks and Nasdaq Composite is next. Facebook’s stock went public on May 18, 2012, meaning investors have never suffered a bear market at the same time as Alphabet investors. What might a unanimous FAANG bear market mean for investors? Janney Montgomery Scott technical analyst Dan Wantrobski said the loss of leadership from the technology sector in general, and more specifically the FAANG stocks, which had been a “significant driver of the markets” for the past few years, is one of the reasons the broader U.S. stock market continues to struggle. “Our analysis continues to suggest that this segment may continue to underperform the broader markets for some time longer,” Wantrobski wrote in a note to clients. Meanwhile, the Nasdaq Composite Index
of which all the FAANG stocks are components, has declined 14.8% from its Aug. 29 record close of 8,109.69; the Dow Jones Industrial Average
has lost 8.8% since closing at a record 26,828.39 on Oct. 3 and the S&P 500 index
is 9.9% below its Sept. 20 record of 2,930.75.
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