One more global shock is expected in the market
- Crude, inflation and bond yields all pose a risk of moving into a new trading range. At present, the debate over value versus growth among global investors has gained momentum. Seeing change after almost a decade of under-performing. This year will be a lot like 2000 when the tech bubble burst. The growth of small and mid-cap stocks has been completely washed away in the last few months. This was not noticed by many due to the wide range of indicators. Shares of 10 major tech companies have risen 20% in 2021. Shares of about 4 per cent Nasdaq companies are trading below their 20-week high of 20 per cent. The Russell 2000 Growth Index is trading more than 20% below its February 2021 high. Market momentum has been affected. Despite the market slump, stocks are trading at three times higher. Even then the assessments looked challenging. High-speed, loss-making, valuation sensitive stocks appear to be bursting the bubble. The Federal Reserve appears to be committed to reducing liquid