Is This An Opportunity To Buy The Dip In Tech Stocks?
After a pullback in the Nasdaq yesterday, we explore if it's a buying opportunity. Watch Premarket Prep exclusively on Benzinga's YouTube channel every market morning at 8AM ET.
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00:00 We definitely saw some pullback in the NASDAQ.
00:02 Some stocks down more than 5% yesterday.
00:06 I wanna kind of just quickly run through
00:08 some of those names and then Dennis,
00:10 I wanna get your outlook on why potentially
00:13 this could have happened just yesterday.
00:15 So stocks like Zscaler going back about 5%.
00:20 So I'm gonna quickly just run through some of these
00:22 that I just pulled, of course,
00:24 using Benzinga's scanner there.
00:27 Twillow back down, Asana back down pretty good amount,
00:31 CrowdStrike back down a pretty good amount,
00:34 but these stocks were hot, right?
00:36 And I mean, these are the stocks
00:37 that were pushing pretty strong.
00:38 Look at AMAT's move right back down
00:41 and Snow, a recent favorite also turning around.
00:45 EMPH, a solar name that just had gotten hot.
00:49 Quick turnarounds here.
00:50 Now, of course, a lot of people will be looking at
00:53 to see what happens now.
00:55 Is it time to kind of buy the dip in tech
00:58 or why could this have happened yesterday, Dennis?
01:01 I mean, there's a lot of factors here.
01:04 One, stocks have run a long ways.
01:07 Tech stocks have been running
01:08 for basically six months straight.
01:10 A lot of these smaller names you're talking about
01:12 been running pretty hard for the last month,
01:14 month and a half.
01:14 We've been talking about this six week run
01:16 in the Cathie stocks.
01:17 A lot of those names you just mentioned
01:19 are Cathie type stocks.
01:21 You know, not zombie necessarily, but kind of,
01:24 you know, companies that aren't making money,
01:26 but their growth is there and they're hopeful,
01:28 you know, obviously,
01:29 that there's going to be a story here eventually.
01:32 And then you have the sell off in mega cap tech.
01:34 And one thing to consider and what people, you know,
01:37 have just kind of not been talking about at all
01:39 is the rebalance.
01:41 We have the rebalance coming here
01:43 after the close tonight.
01:46 Obviously, it's going to be the rebalancing
01:48 actually take going official on Monday.
01:51 So I think you've got a little bit of jockeying
01:53 ahead of that,
01:54 where you're going to have the special rebalance
01:56 on the queues where the magnificent seven
01:58 waiting goes lower.
01:59 So Microsoft is going to have a big sell.
02:02 Nvidia is going to have a big sell
02:03 potentially at the close here.
02:05 We've also obviously got, you know,
02:06 a number of other stocks getting sold,
02:08 but then other stocks getting bought too.
02:10 So, but more than anything yesterday,
02:13 it was just profit taking here, Mitch.
02:15 I mean, people were sitting on a lot of profits
02:17 in a lot of these stocks.
02:18 You had Nvidia and Tesla,
02:20 which basically were getting pulled right off the gate
02:23 and pressure on them all day.
02:25 And then it just kind of snowballed from there.
02:27 And, you know, as much as, you know,
02:29 Apple, Microsoft opened higher
02:31 and I was like, I was shocked.
02:33 We started seeing those up.
02:34 Those were just opportunities.
02:35 And those stocks ended up closing very, very weak.
02:38 Nvidia ended up closing very, very weak.
02:41 AMD was awful yesterday.
02:43 Two day reversal after being 121.
02:45 You know, it's just,
02:46 it's just a lot of people have been sitting
02:48 on a lot of money, a lot of profits.
02:50 And the Tesla and the Netflix sell-off
02:53 was an excuse for them to take profits
02:55 across the board in tech.