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GOOG and GOOGL Stock Alert: What’s Going on with Alphabet Shares Today?

As investors wake up and check their portfolios this morning, tech-heavy traders will be none too happy with what they see. Stocks that have dominated in recent years have been falling into disarray thanks to the pandemic. Now, the lot are ta…

As investors wake up and check their portfolios this morning, tech-heavy traders will be none too happy with what they see. Stocks that have dominated in recent years have been falling into disarray thanks to the pandemic. Now, the lot are taking even more significant losses in a market-wide correction that’s bringing down many major indices, too. One of the names hit by this big tech collapse is Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL). What’s going on with GOOG and GOOGL stock today?

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To understand the context behind the GOOG and GOOGL stock alert today, one must consider the tumultuous beginning of the decade. At the onset of the pandemic, the stock market had seen a major correction; the S&P 500 fell over 30% before the U.S. Federal Reserve began its programmatic stimulus spending. This signifies the struggles of the tech industry at the time; tech stocks make up 28% of the index. These companies were ravaged by the fear that ruled the world, which saw investors immediately jumping ship from riskier investments.

Of course, looking back we now know the industry wouldn’t be held down for long. Thanks to the Fed’s aggressive monetary policy, the dollar was able to stay strong through the worst of Covid. In fact, the policy primed the market for riskier investments. Tech stocks were able to not only recover to pre-pandemic levels, but even soar far beyond them.

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GOOG and GOOGL Stock Alert: Alphabet Under Close Watch as Monetary Policy Continues to Take Shape

However, things have taken a turn in the last handful of months for the entire market. The Fed is slowing down on its spending. With the economy back on track, the central bank must address challenges regarding inflation. What’s more, as this risk-off era of investing comes to an end, there are fears of heavy stock market corrections throughout the year in the fight against inflation. This — combined with several other new factors including the Russia-Ukraine conflict — has hampered tech plays significantly in recent months. With the market showing little signs of slowing down losses, GOOG and GOOGL stock holders are on high alert.

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So, the Fed has its work cut out for it in 2022. On top of continuing to reduce its balance sheet, the central bank will need to combat rising inflation. It’s aiming to do so through a series of interest rate hikes, the first of which is expected for March. This is already detrimental to tech and other high-growth stocks, as investors will be incentivized to cycle out of these investments and into safer ones.

Supply-Chain Woes Continue to Plague Tech, Russia-Ukraine Conflict a New Heel

Atop these worries (which investors have been able to anticipate for months now), there are also several other hinderances to the industry. One concern? Supply-chain issues which continue to plague tech as well as dozens of other sectors. Particularly, the lack of microprocessors — which have been in short supply for years now — continues to stifle growth in the sector. All in all, these factors are dragging down the tech industry in 2022, similar to how things were at the onset of the pandemic.

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In addition to these woes, there’s also news in regard to the Russia-Ukraine conflict that’s rippling across the industry. The invasion of Ukraine by Russian forces early this morning is serving to send panic across the entire stock market. And of course, it only makes sense that high-risk investments like tech are those hit hardest. Much like early 2020, the major indices are posting higher-than-normal losses on the news, while commodities like gold and crude oil continue to rise. The latter has surpassed $100 per barrel for the first time since 2014.

This morning, the S&P 500 is trading down by roughly 1.2% in response to the news in Eastern Europe. The Nasdaq Composite, another tech-heavy index, is also down 0.5% at the time of this writing. While other tech stocks trade in the red today, GOOG and GOOGL stock have been able to stay close to the green throughout the morning.

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On the date of publication, Brenden Rearick did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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