July 30, 2020, 11:21 am EDT
Tough Battle Between GDP and Tech
US Q2 GDP hit a record low of -32.9% that dragged entire stock markets with DJIA near -500 points. Now, it comes back to -300 points to 26235. Indeed, COVID-19 virus is the worst ever disaster to the US history in terms of US economy and death numbers.
Ironically, all major technology rose to record high like AAPL, AMZN, FB, TSLA, MSFT, GOOGL, FB with trillions of market capital in the past few months.
There are two reasons to explain this weird situation. First, technology does not suffer much like retailers, restaurants and physical business. In fact, it could benefit from viruses like AMZN, MSFT, FB, NFLX. Second, US government issues cash, loans, stimulus, unemployment checks to hold the economy from falling down.
But, now is the time to face a tough fight between GDP and the mega tech. AAPL, AMZN, and FB will make earning reports today after market close. Reality will be revealed soon.
Our viewpoints tend to be bearish for technology stocks from a technical point of view. Most recent article, Watch out Nasdaq Index, and few other articles point out weaknesses for potential pullback or top-out. Thus, another major breakdown could change the direction to downside or correction.