Apple, SanDisk pulling techs down?
Both stocks have had big run-ups, helping techs move higher. But smart money may be getting out.
Updated at 6:40 p.m. ET
Watch techs. Watch Apple (AAPL) and SanDisk (SNDK). They're getting hit hard, and they could pull the rest of techland lower with them.
Apple was off 2.9% to $258.68 today. Apple hasn't had a 3% decline since the market pullback at the end of January and early February.
SanDisk, the maker of flash-memory chips, was down 4.2% to $41.694.
The Nasdaq Composite Index ($COMPX) was off 74 points, or 3%, to 2,424. The Nasdaq-100 Index ($NDX.X) was off 63 points, or 3.1%, to 1,969. The Power Shares QQQ (QQQQ) exchange-traded fund, better known as the Nasdaq-100 tracking stack, was down 3% to $48.43.
The Philadelphia Semiconductor Index ($SOX) is down 4.5% to 368.
This is not meant to be a litany of stocks and indexes getting clobbered, although Google (GOOG), Dell (DELL), Oracle (ORCL) and Amazon.com (AMZN) were all off more than 3% today.
Rather, Apple and SanDisk, especially, have looked overbought and pulled the tech sector with them. That is, lots of people have been buying tech stocks, regardless of whether the prices make any sense.
Apple shares jumped 32.3% between Feb. 26 and April 23, when they closed at $270.83, with volumes running between 25 million and 30 million shares, about 40% higher than normal.
SanDisk has had an even bigger run-up since the end of February: up 49.3%. In fact, it has been a better performer than Apple since the end of 2008. It's up 350% to Apple's 212%.
At some point, the stocks start to show some disturbing patterns. The most dangerous is the head-and-shoulders pattern. It occurs when a stock hits a high, dips, hits a new high, dips and rises again but can't move past that second high.
Technicians see that as a big-time sell signal. It happened this week with the QQQ (aka the Nasdaq-100 tracking stock.). You can see it in a chart here.
It happened with Apple as well.
Copyright © 2014 Microsoft. All rights reserved.
Fundamental company data and historical chart data provided by Morningstar Inc. Real-time index quotes and delayed quotes supplied by Morningstar Inc. Quotes delayed by up to 15 minutes, except where indicated otherwise. Fund summary, fund performance and dividend data provided by Morningstar Inc. Analyst recommendations provided by Zacks Investment Research. StockScouter data provided by Verus Analytics. IPO data provided by Hoover's Inc. Index membership data provided by Morningstar Inc.
[BRIEFING.COM] The major averages began the new trading week on a slightly lower note with small caps leading the weakness. The Russell 2000 shed 0.3% while the S&P 500 slipped less than a point with six sectors ending in the red.
Equity indices began the day in negative territory with only the Nasdaq (-0.04%) making a very brief appearance in the green. After sliding through the first hour of action, the major averages reversed and spent the remainder of the session climbing off ... More
More Market News
|There’s a problem getting this information right now. Please try again later.|
VIDEO ON MSN MONEY
MUST-SEE ON MSN
- Video: Easy DIY smoked meats at home
A charcuterie master shares his process for cold-smoking meat at home.
- Jetpacks about to go mainstream
- Weird things covered by home insurance
- Bing: 70 percent of adults report 'digital eye strain'