Now Alphabet Breaks, Microsoft Too, Meta Already in Freefall: One by One the Giant Stocks That Supported the Market Are Letting Go
Ugly day. But I’m increasingly amazed at how Microsoft’s CEO picked the top to sell half of his stock last November.
By Wolf Richter for WOLF STREET.
The Nasdaq fell 2.6% today and is again down more than 20% from its peak last November. Lots of action was hammered out today. But it was the giants who stole the show. They let go now.
Hundreds of stocks have plunged since February 2021, one after another the most hyped stocks have been pulled and shot, down 70%, 80% and even over 90%, often just months after started trading as a public company. I have documented some of them in my Implosed Stocks column.
For most of the time, giant stocks have kept global stock indices from collapsing altogether despite the chaos below the surface. But now the giants are letting go too. Meta has already collapsed over the past few months. Amazon used enormous financial engineering to stem the fall, and it only worked briefly. And today, Alphabet is letting go.
Alphabet [GOOG] broke today. It fell 4.3% today in normal trading hours and 0.9% after hours trading at $2,390, down $108, and leaving behind the resistance from which it managed to bounce three times.
The stock is now back where it first was on April 29, 2021 and is on course to turn negative year-over-year. Alphabet shares have now fallen 21.4% from the 52-week high on February 2 this year (data via YCharts):
Meta, the good old Facebook that tried to fix its problems by changing its name pooh, in vain, was the pioneer among the giants for reasons of its own. His actions [FB] fell 2.1% today and has now plunged 52% from its high on September 1, 2021 ($384).
At this rate, I’ll soon have to add Meta to my imploded stocks, much like I was forced to do with Netflix’s old component FANGMAN, which has crashed 69% since its peak last November.
Meta today broke through the resistance level set in the second week of March and set a new 52-week closing low, having now fallen to levels it first broke in April 2019. This is an awful chart (data via YCharts):
Microsoft let go too. The shares [MSFT] fell 2.4% today to $274.03 and even lower after hours. They broke through the March 7 closing low and closed at the lowest point since July 1, 2021. From their November 22 high, the shares have since fallen 21.6%.
What remains an incredible WTF trade of all time is how CEO Satya Nadella dumped half of his Microsoft shares at the peak, almost on the minute on November 22-23. I mean, few people are better at picking the very tippy-top to dump half their stake, worth $285 million, right there (data via YCharts).
Amazon tried every trick of financial engineering in early March to stem its stock slide with the announcement of a 20-for-1 stock split and a huge stock buyback program for which it is borrowing tons silver. And it worked, briefly. Stocks rebounded but have since given up almost all of the financial engineering rebound.
Today, Amazon [AMZN] fell 2.7% to $2,887 and fell another $5 in after-hours trading. It’s down 23.5% from the July 2021 peak. But it hasn’t broken through the pre-financial engineering low of early March:
You’re here [TSLA], despite the chaos in the markets today, barely budged, falling 0.4% to $1,005 and losing another $5 in after-hours trading. Since its peak on Nov. 4, stocks have fallen 19.4% but remain well above March lows.
Of course, Tesla is no ordinary company. Its CEO walks on water. And in the past two years, the stock price has gone up 10 times, a miracle of its kind, by far the most valuable automaker in the world, despite its tiny market share. And Tesla’s P/E ratio of 135 is another miracle for an automaker, but no other CEO walks on water.
Apple [AAPL] fell 2.8% today to $161.79. But he still holds on by his nails. Since the Jan. 4 high, shares have fallen “only” 11.5%, the smallest drop among the giants, and Apple by market capitalization ($2.64 trillion) is the largest of all.
The stock price is still well above its recent low in early March. And given Apple’s huge size, it single-handedly slowed the decline of global indexes. So when Apple lets go, it will cause, say, additional ripples.
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