May 11, 2022, 3:18 pm EDT
Two Falling Giants
Two falling giants, Apple (AAPL) -6% and Tesla (TSLA) -8%, opened up a new major downtrend for all major indexes: Nasdaq, S&P 500, and Dow Jones for a fresh 52-week new lows today.
They used to be the largest and strongest leaders in the major bull markets in the past 13 years. But, they gave up to hold their values when Consumer Price Index reached another 40-year high level of 8.3%.
Both Apple and Tesla need consumers to buy their phones or cars in order to prosper. But consumers face record-high inflation that sucks out big chunks of money for energy and food. More importantly, high inflation could continue for another 6 months or a few years. Thus, it makes sense that those consumer-oriented products face a tough time ahead.
If the stronger leaders are falling down, who will lead the market to climb uphills?
That is a good question to think about.