If you missed it, today was a bad day for US stocks, as the market finally seemed to come to it’s senses and correct.
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 Amazon.com declined, along with biotechnology companies, with Pacific Biosciences of California, Zogenix and ChemoCentryx among those hit.
I can’t say I am surprised. I avoided these stocks because I felt they were over inflated. The earnings expectations that drove the prices were just not realistic or even within the realm of possiblity in an economy on fire. The thing is that now I have a real good opportunity to buy some other stocks, or see the ones I already hold, going up, as people flock to more reasonable havens.
Of couse, with the government eyeing my 401(K) for the day they run out of other people’s money, this is all moot.