Thanksgiving week was not supposed to be like this. Normally things are slow in the days leading up to Thanksgiving as investors prepare to gorge themselves with turkey and stuffing as they gather with family and friends. But this year the stock market is crashing, and Wall Street is in panic mode. On Tuesday, the Dow Jones Industrial Average closed at 24,465.64, which is nearly 2,500 points lower than the all-time high of 26,951.81 that was set in early October. But as I noted yesterday, what has been happening to tech stocks is even more dramatic. Each one of the FAANG stocks is now down by more than 20 percent, and they have combined to lose more than a trillion dollars in value. We haven’t seen anything like this since the financial crisis of 2008, and at this point all of Wall Street’s gains for 2018 have been completely wiped out.
Fear is a very powerful motivator, and right now a lot of investors are feverishly getting out of the market because they are afraid of losing their paper profits.
One analyst is describing what is going on as a rush for the exits…
“The highways will be crowded this evening as the Thanksgiving rush will begin in earnest, but this morning investors are rushing for the exits,” Paul Hickey, co-founder of Bespoke Investment Group, wrote to clients on Tuesday.
But for many tech investors, the truth is that the cattle have already left the barn.
Just check out how much market capitalization the “big five” have already lost. The following numbers come from CNBC…
- Facebook: $253 billion
- Amazon: $280 billion
- Apple: $253 billion
- Netflix: $67 billion
- Alphabet: $164 billion
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