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Why the tech stock selloff matters

Rising U.S. bond yields again sent tech stocks tumbling on Monday, with the tech-heavy Nasdaq composite index falling into its third 10% correction in the last year.

Why it matters: With the real economy still depressed, especially the labor market, continued weakness in Big Tech and a deflating housing market could undercut the expected economic recovery.


  • Both stocks and housing have been underpinned by historically low interest rates and inflation expectations, which now are jumping at the fastest pace in years.

What it means: Tech stocks have been incredibly volatile over the past year, rising and falling more than the rest of the market, as even trillion-dollar companies like Apple routinely see 3% and 4% daily moves.

The big picture: The exaggerated stock price moves in tech are amplifying overall market volatility, but that volatility bears watching because of the growing role tech plays in the U.S. economy.

  • All five of the largest U.S. companies by market cap are in tech — Apple, Microsoft, Amazon, Alphabet and Facebook, in that order — and together they hold a market cap of more than $8.2 trillion.
  • The entire S&P 500 has a market cap of $33.9 trillion, according to S&P Global, meaning the Big Five account for just under a quarter of the benchmark U.S. stock index's value.

By the numbers: On Monday, those five companies suffered an average share decline of 3%, led by 4% pullbacks in Apple and Amazon.

  • Tech companies across the board have been stung by the selloff, with previous world-beating market champions including Tesla, Zoom, Nvidia, Square and AMD all down by 20% since Feb. 12, when the Nasdaq hit its last record high.
  • Tesla is actually down by 35% from its last record high on Jan. 26, the third time in about a year it has lost close to a third of its value.

Between the lines: Despite all the talk of investors rotating from big, tech-heavy growth stocks to "cheaper" value stocks over the past month, the biggest beneficiaries of the rotation have been stocks with incredibly high forward price-to-earnings ratios like ExxonMobil (278.2 12-month forward P/E), Disney (60.2) and Mastercard (45.8).

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Outdoor lovers beware: Ticks and poison ivy are on the rise

Americans looking to enjoy their summer outside after a pandemic year now have other threats to worry about.

The big picture: Experts are warning that ticks are on the rise and poison ivy may be more abundant this year. That means hikers, campers and anyone else excited to get outside after months of pandemic confinement should take extra precautions to avoid both.

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Exclusive: John McCain interviewed in new Ken Burns film on Ernest Hemingway

John McCain, just before his death in 2018, did an interview for Ken Burns’ upcoming PBS film about Ernest Hemingway, in which the senator talks about "For Whom The Bell Tolls" and his hero, Robert Jordan.

The big picture: "Hemingway" — a three-part, six-hour documentary film by Ken Burns and Lynn Novick — examines the visionary work and turbulent life of Ernest Hemingway, one of America's iconic writers.

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Scammers seize on COVID confusion

Data: FTC; Chart: Sara Wise/Axios

Scamming has skyrocketed in the past year, and much of the increase is attributed to COVID-related scams, more recently around vaccines.

Why it matters: The pandemic has created a prime opportunity for scammers to target people who are already confused about the chaotic rollouts of things like stimulus payments, loans, contact tracing and vaccines. Data shows that older people who aren't digitally literate are the most vulnerable.

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How to build forests to combat climate change

Trees can help to combat climate change, but determining what to plant and where is complex — and whether to plant them at all is a growing debate.

The big picture: Protecting, planting and restoring forests can help offsetglobal warming, but experts stress that greenhouse gas emissions still have to be dramatically cut to reach climate goals for the planet.

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