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ASX 200 tech shares set to slide as Nasdaq plunges 2%

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The post ASX 200 tech shares set to slide as Nasdaq plunges 2% appeared first on The Motley Fool Australia. –

Wall Street might have paved the way for another hair-raising drop for S&P/ASX 200 Index (ASX: XJO) tech shares on Tuesday.

Major US indices tumbled overnight but it was technology stocks that were the most hard-hit as bond yields itched higher.

The yield on benchmark 10-year Treasury notes rose to highs of 1.51% from 1.46% on Monday. It was just a month ago that yields were sitting at around 1.32%.

This comes just before the US Federal Reserve signalled that it will begin reducing its monthly bond purchases as soon as November, which could lower bond prices and push yields even higher.

The Nasdaq Composite plunged 311 points or 2.14% while the S&P 500 and Dow Jones Industrial Average fell 1.3% and 0.94% respectively. Perhaps signalling a continued rotation out of technology and back into safe haven assets such as bonds and gold.

Big tech led the declines with heavyweights Facebook, Amazon, Microsoft, Alphabet and Apple all sliding between 2% to 4.9%.

This could point to a continued weakness for ASX 200 tech shares, especially given that ASX futures are currently pointing to a 68 point or 0.94% decline.

ASX 200 tech shares on watch

The Afterpay Ltd (ASX: APT) share price could be set to fall this morning after Square shares fell 5.43% overnight to a 2-month low of US$226.25.

The largest US-listed BNPL player, Affirm, also posted significant declines, down 8.42%.

This could place the broader ASX-BNPL sector on watch, especially big names like Zip Co Ltd (ASX: Z1P) and Sezzle Inc (ASX: SZL).

Weakness in the Global X FinTech Exchange Traded Fund (ETF) might also affect ASX-listed players such as Xero Limited (ASX: XRO), Tyro Payments Ltd (ASX: TYR) and EML Payments Ltd (ASX: EML).

The FinTech ETF tanked 3.72% overnight and is comprised of leading companies in the emerging financial technology sector. Its top 5 holdings include household names such as Adyen, Square and PayPal.

The post ASX 200 tech shares set to slide as Nasdaq plunges 2% appeared first on The Motley Fool Australia.

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More reading

Why did the Afterpay (ASX:APT) share price have such a bad month in September?
Square slumps 5%. How could this impact the Afterpay (ASX:APT) share price today?
5 things to watch on the ASX 200 on Tuesday

These were the best performing ASX BNPL shares in September

What happened for the Zip (ASX:Z1P) share price in September?

John Mackey, CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Teresa Kersten, an employee of LinkedIn, a Microsoft subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to its CEO, Mark Zuckerberg, is a member of The Motley Fool’s board of directors. Motley Fool contributor Kerry Sun has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. owns shares of and has recommended AFTERPAY T FPO, Affirm Holdings, Inc., Alphabet (A shares), Alphabet (C shares), Amazon, Apple, EML Payments, Facebook, Microsoft, PayPal Holdings, Square, Tyro Payments, Xero, and ZIPCOLTD FPO. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has recommended the following options: long January 2022 $1,920 calls on Amazon, long January 2022 $75 calls on PayPal Holdings, long March 2023 $120 calls on Apple, short January 2022 $1,940 calls on Amazon, and short March 2023 $130 calls on Apple. The Motley Fool Australia owns shares of and has recommended AFTERPAY T FPO, EML Payments, and Xero. The Motley Fool Australia has recommended Alphabet (A shares), Alphabet (C shares), Amazon, Apple, Facebook, PayPal Holdings, and Tyro Payments. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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