U.S. Treasury Secretary Janet Yellen (Janet Yellen) said Tuesday (4), in order to prevent large-scale government spending caused by economic overheating, may have to moderate interest rate increases, this speech prompted growth stocks selling pressure emerged, female stock goddess Wood (Cathie Wood) directed by the Ark Investment Company (ARK Invest) under the ARK Innovation ETF (ARK Innovation ETF) once fell 4.8%.
Yellen said on Tuesday in “The Atlantic” recorded interview, compared to the overall economy, the scale of additional government spending, although small, but in order to ensure that the economy does not overheat, may have to raise interest rates, which is necessary to make the economy competitive and productive investment.
Yellen to Fed-like remarks to shock the market, last year’s big earnings 152%, 6-year average return of 36% ARK Innovation ETF Tuesday afternoon trading once plunged 4.8%, the Nasdaq Composite Index (IXIC) fell 2.5%.
Shares of Tesla (TSLA-US) were down more than 3%, Teladoc Health (TDOC-US) was down 5.8%, Square (SQ-US) and Roku (ROKU-US) were down 5.8% and 6.7%, respectively. shares of Zillow Group ( ZG-US) were down more than 5%.
Other ETFs of the female stock goddess also experienced significant selling pressure at midday Tuesday. ARK Next Generation ETF (ARKW) fell 4.5%, sending it down more than 6.5% so far this week. Technology and Robotics ETF (ARKQ) fell 4.3% and 2.9%, respectively, in midday trading Tuesday. ARK Fintech Innovation ETF (ARKF) fell 4.25%, taking its week-to-date loss to more than 5%.
Wall Street analysts believe that U.S. Treasury Secretary Yellen stirred up a lake of spring water in the stock market, investors may be taking profits and moving to industries with more leverage to restart the economy, plus, the threat of higher capital gains taxes may not help market sentiment.
Jim Paulsen, chief investment strategist at Leuthold Group, said in an interview: “Investors may be increasingly disappointed by the poor performance of the stock market in the face of bright earnings reports. If the good news has been fully digested, the market may be about to top out.”
Stephanie Link, chief investment strategist at HighTower, said, “High cost-to-benefit ratio technology stocks are trading very crowded. Comparisons going forward will be tough, and high valuations won’t perform well when investors see better GDP growth and slightly higher inflation.”
FactSet data shows that more than $290 million flowed out of the ARK Innovation ETF last week, however, more than $7 billion has poured into the female stock gods’ ETFs this year.
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