NASDAQ 100

Nasdaq 100

Recent reports that the sale of flagship products of Apple Inc. has slowed down led to a selloff in the Apple stock in the beginning of June last month. This also had a rub off effect on other stocks bearing a heavy weightage in the index, consequently leading to a drop in the index as well.

Together Apple, Microsoft, Amazon, Google (Class C Stock, however the charts show Class A Stock) and Facebook contribute to 33% weightage in the Index – Nasdaq 100. Apple’s stock individually is the single largest contributor to the Index; it’s weight being close to 15%, immediately followed by Microsoft (weight 7.4%).

With the earnings season kicking in, it will be interesting to observe if the growth in earnings of these stocks has been consistent with their respective prevailing PE multiples.

However recent stock price action of the above five stocks has clearly indicated weakness and the selling pressure is evident through the pattern of the multi-period candlestick charts of these stocks.

The author can be contacted at: riskadvisory@outlook.com.

DISCLAIMER:

These extracts from my trading files are for the purpose of education only. Any advice contained therein is provided for the general information of readers and does not have regard to any particular person's investment objectives, financial situation or needs and must not be construed as an advice to buy, hold and sell or otherwise deal in commodities, currencies, indices, securities or other forms of investments. Accordingly, no reader should act on the basis of any information contained therein without consulting a suitably qualified financial advisor in the first place.