A team of Citigroup strategists led by Chris Montagu believes there remains "significant pressure" on U.S. technology companies, as they continue to be "bullish" despite the recent decline in share prices, Bloomberg reports.
The strategist points out that Nasdaq 100 contracts still have "long" positions worth about $22.5 billion. dollars.
"With negative macro data, there will be significant pressure on these long positions, which can generate an average loss of 7.6 percent." This, in turn, could reinforce a potential downside move from current levels in the near term," writes Chris Montagu in a report.
Recently, increased concerns about the weakening of the US economy have had a negative impact on the quotations of technology companies, whose valuations are considered the least high. It is true that we have had a rebound in recent trading sessions.
Bloomberg points out that the latest Bank of America survey showed continued optimism among investors about the largest technology companies, as well as faith in the so-called soft landing of the US economy. Currently, 36 percent of investors believe that growth companies with the largest capitalizations are likely to lead the new "bull market" in the United States.
