Global markets cautious rebound One asset manager says there’s no need to worry about a sustained downturn caused by the bursting of the tech bubble.
Technology stocks have been among the hardest hit by the recent sell-off, falling 1.6% in July Wall Street’s tech-heavy Nasdaq 100 index has risen more than 4% so far in August Rekindling debate over whether the industry is a bubble Waiting to explode.
“I just don’t see a tech bubble,” Manish Singh, chief investment officer at Crossbridge Capital, told CNBC’s “Squawk Box Europe.” “Yes, there are stocks that are doing well and they’re doing well on the earnings side. outstanding.
Singer noted of the Nasdaq that on an equal-weighted basis — where every stock has the same weight regardless of market capitalization — the index has been flat over the past three years.
“So if you have 100 stocks and seven of them are doing well because of earnings, that’s great. There are 90 other stocks that are not doing well, so I don’t see any reason to worry that you’re going to go into bearish mode and the market is overbought. , so people will sell,” he said.
Tech’s recent bull run has been driven in part by the so-called “Big Seven” apple, Amazon, letter, Yuan, Microsoft, NVIDIA and Tesla.
Mag 7 index.
Singer spoke more broadly. S&P 500 Index It’s not overbought either, with annual gains over the past three years of less than 4% due to weakness in 2022 and 2023.
From a profit perspective, Microsoft’s performance triggered a sharp sell-off Previous stocks in semiconductor companies AMDthe result trigger a backlash Singh continued, by stressing that demand remains strong.
“That doesn’t tell you that the market has confidence no matter which way it wants to go,” he said.
Volatility remains unchanged
Although European, Asia-Pacific and U.S. stock markets recovered recent losses, market observers agreed that volatility is likely to persist.
“I do think there will be a little more volatility in August because that’s the seasonal pattern… Last year we had (a) very similar thing, and if you look at if you overlay this year’s chart onto last year, We pretty much follow the same pattern,” Singh said.
“It’s no different than what you see in a U.S. election year, where there’s seasonality around August and September, and then after the election, the market starts to rebound,” he said.
Matthews Dibo, managing director of investment strategy at Goldman Sachs Private Wealth Management, noted that the Vix Volatility Index surged last Monday to an intraday high not seen since the 2008 financial crisis or the COVID-19 pandemic, but said the context for these occasions was different. .
He told CNBC on Monday that technical factors were pushing up the Vix index, and that macro concerns and the unwinding of yen carry trades exacerbated simultaneous declines in stocks, bond yields and commodities.
“It’s hard to know whether the worst is over… Volatility is likely to remain elevated for quite some time,” he said, citing U.S. retail sales data, consumer price index and Fed data in Jackson Hole. The meetings held are likely to impact the market this year.
“But when you look at the fundamentals of the U.S. economy, we think they’re still pretty solid,” he said.
