The top tech stocks were beaten down Tuesday as FANG companies faced concerns about their latest quarterly earnings reports and possible future regulation.
"Investors are on pins and needles on the FANG stocks," said GBH Insights analyst Daniel Ives, as most of these companies report earnings this week and next. Additional volatility has been brought into the mix as companies like Facebook Inc. (FB) and Alphabet Inc. (GOOGL) prepare for regulation in Europe, he said.
"Before, [regulation] wasn't a worry, and it has made investors more jittery," Ives said.
Loup Ventures managing partner Gene Munster said that this is "as good as it gets in the near-term" for these stocks, given Alphabet's mixed earnings announcement and the disappointing forecast of one of Apple Inc.'s (AAPL) main European suppliers that's led to pessimism about iPhone X sales.
Munster is optimistic in the long-term for the FAANG stocks, however, as there are opportunities for them to expand into non-tech areas such as healthcare, energy and content. "The runway is still exciting for these large-cap names, despite these concerning stock movements."
While the S&P 500 fell 1.3% on Tuesday and the Nasdaq dropped 1.7%, Alphabet Inc. (GOOGL) stock led the FAANG stocks down with a 4.5% drop, closing at $1019.98.
Netflix Inc. (NFLX) stock fell 3.7% to $307.02, while Amazon.com Inc. (AMZN) shares fell 3.8% to $1460.09 and Facebook Inc. (FB) stock fell 3.7% to $159.69. Apple Inc. (AAPL) shares fell 1.4% on Tuesday and have slumped almost 9% since last Friday.
Facebook is scheduled to report first-quarter earnings on Wednesday, Amazon on Thursday and Apple on May 1.
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