Amazon and Google close out their worst months on Wall Street since 2008

Getty Images; Chris Ratcliff | Bloomberg | Getty Images

Stocks of Amazon and Google parent Alphabet have just completed their steepest monthly declines since the 2008 financial crisis.

The internet giants both reported weaker-than-expected quarterly results this week, weighed down by a combination of macroeconomic factors, the war in Ukraine and harsh comparisons to blowout numbers during the pandemic.

Amazon plunged 23.8% in April, the biggest drop since its 25.4% plunge in November 2008, the same month that Google plunged 18.5%. Alphabet had its worst month since that time, falling 18% in April.

In the early months of 2022, investors have retreated from the technology sector on fears of rising inflation and higher interest rates. The Russian invasion of Ukraine in February, the subsequent rise in fuel prices and persistent labor shortages have begun to hurt corporate profits.

The last time Amazon and Google saw this kind of sell-off was in the midst of the global financial crisis, when record levels of borrowers defaulted on home loans and many of the top financial institutions went bust. Lehman Brothers collapsed in September 2008, followed by a series of major Wall Street bailouts.

Tech stocks have been wiped out across the board. The Nasdaq fell 11% in November after plummeting 18% in October.

It’s been a mixed bag for the Big Tech class so far this results season. Facebook reported better-than-expected earnings despite missing out on revenue, and told investors second-quarter sales could be down year-over-year. Apple beat expectations but scared investors after it warned that supply shortages could hurt sales in the current quarter.

On Thursday, Amazon issued weak current-quarter guidance, and growth rates stagnated at their lowest since the dot-com bust in 2001. Earlier in the week, Google missed out on revenue and profit and reported a big loss in its YouTube segment, where The Revenue increased just 14%.

While both stocks have suffered so far this year, their price developments have diverged significantly in 2021. Alphabet was the best-performing big tech stock of the year, up 68%. Amazon was the bottom performer, up 2.4%.

WATCH: There’s not much confidence in tech stocks right now, says Jefferies’ Brent Thill

About Ellen Lewandowski

Check Also

Mississippi Gov. Tate Reeves says it’s a “great day not to be in Jackson amid the water crisis.”

Mississippi Gov. Tate Reeves (R) said Friday it was, as always, “a great day not …