Peloton fell below its IPO price, Netflix suffered its steepest drop in a decade, and chip stocks continued to struggle. Add it all up and the Nasdaq just closed out its worst week since the beginning of the pandemic.
At Friday's close, the Nasdaq was down 7.6% for the week, its biggest decline since March 2020, when global markets sank on Covid-19 concerns. It's also the fourth straight weekly drop for the tech-heavy index, the longest losing streak since a similar stretch last April and May.
Heading into 2022, the story for tech stocks was outward rotation. Inflationary pressure was leading the Federal Reserve to signal that interest rate hikes were coming. Shares of cloud-computing companies and other high-multiple stocks that outperformed the market in recent years were plunging as the work-from-home theme fell apart.
Business fundamentals still appeared to be solid, though, and the economy was on the upswing.
That confidence waned this week, as terrible news in pockets of the technology sector raised concerns with the wave of Q4 tech earnings reports set to kick off in the coming days.
Peloton on Thursday reported preliminary quarterly results and said the number of connected fitness subscribers will fall short of expectations. The company put out its release after CNBC reported that Peloton is temporarily halting production of its connected bikes and treadmills and looking for ways to control costs.
