Apple downgrade triggers tech selloff, sending Alphabet and Microsoft to year-to-date lows – Reuters

Shares of major tech companies suffered heavy losses on Thursday, dragging many other U.S. stocks with them, after analysts at Bank of America downgraded Apple shares.

Tech stocks have been pushed lower all year as investors abandoned growth and flocked to more defensive assets to weather higher interest rates and anticipate a possible recession.

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The tech-heavy Nasdaq Composite rose on Tuesday and Wednesday, but the buying came after the worst two weeks since the start of the Covid pandemic. Now the downtrend is back, with the Nasdaq down 2.8% on Thursday – the biggest one-day decline since September 13. The broader S&P 500 fell 2.1%.

Apple shares fell nearly 5% as analysts at Bank of America led by Wamsi Mohan changed their buy rating to neutral, deviating from the buy stance held by a majority of analysts polled by FactSet.

Analysts pointed to several risks, including a weaker buying cycle associated with the iPhone 14 that Apple launched this month. A day earlier, a report said that Apple had scrapped its plan to boost iPhone production by 6 million units in the second half.

Apple stock is now worth 20% less than it was at the end of 2021, while the Nasdaq is down 31% over the same period.

Of the most valuable tech companies out there, Microsoft took the lightest hit. It ended Thursday’s trading session down about 1.5%, which was still a 52-week low. Alphabet, Google’s parent company, also hit a 52-week low, down 2.6%. Shares of Facebook’s parent platforms slid 3.7%, Amazon fell 2.7% and Tesla fell 6.8%.

Smaller, growth-oriented tech companies also suffered, with Coinbase down nearly 8% after Wells Fargo launched a hedge with an underweight rating. Elsewhere, Shopify fell 8.45%, Rivian 7.9% and Roblox 7%.

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