Is the US tech sector crashing back to earth?

By Felicity Duncan

Last week, after a correction in the US tech sector, news stories began to appear that talked about a "tech rout" and the "end of the tech bull market." After leading US stocks higher for the better part of a decade, it seems that tech is falling out of favour. But is this an accurate reading of what's been happening in the markets?

I would argue it isn't, for a number of reasons. First, the "tech sector" is a big tent that includes companies reliant on advertising like Google and Facebook, companies reliant on consumer electronics sales like Apple, and companies reliant on business spending and investment like Microsoft and semi-conductor manufacturer Texas Instruments. The correction has been broad, but not all of these companies are the same. Second, the correction comes after an enormous run in prices. Companies like Amazon have more than doubled over the last year. A 10% correction is not a catastrophe after growth like that – more like a sensible adjustment.

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