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Technology stocks tumble — this is how you will know when to buy them again – Morningstar

By Philip van Doorn
Also, a rundown of earnings analysis for Big Tech, how to invest in bonds, and an estate planning service built into the iPhone
This has been a brutal year for Big Tech, as you can see in the chart below, with Meta Platforms leading the way. Shares of the Facebook holding company plunged 26% on Oct. 27, bringing the 2022 decline to 71%.
Many of the largest technology companies have fared worse than the S&P 500 during this year’s broad bear market.
Believe it or not, the broad market is still trading high by some historical valuation measures.
So how can you know when such a large decline for a tech stock has gone too far? When is it time to buy, in other words? Mark Hulbert analyzes the herd behavior of Wall Street analysts as they cut estimates and ratings for Meta for insight on when the stock will turn the corner.
The season for tech earnings and disappointments
The chart above shows 2022 stock performance, with dividends reinvested, for the FAANG group of stocks, including Facebook’s renamed holding company Meta Platforms, Apple, Amazon.com, Netflix and Google holding company Alphabet, plus Microsoft and Tesla. All but Apple have fared worse this year than the S&P 500, which has fallen 19%.
There was tremendous action for Big Tech stocks this week as quarterly financial results were released. Here’s a selection of reporting and analysis:
Two timely guides to the bond market
With interest rates rising this year as the Federal Reserve takes action against inflation, bond prices have tumbled. Yields have become so attractive that it is time for you to consider moving some money toward bonds if income is, or soon will be, one of your investment objectives.
Here are two in-depth guides to different areas of the bond market:
Did you miss the I-bonds deadline? There’s hope
The U.S. Treasury’s I-bonds have an interest rate of 9.62%, but that deal expires on Oct. 28, which has caused a flurry of interest that may overwhelm the TreasuryDirect.gov website.
But you may be able to get an even better deal next week.
Related: The limit for 401(k) contributions will jump nearly 10% in 2023, but it isn’t always a good idea to max out your retirement investments
An estate planning feature built into your iPhone
The iPhone has a fascinating feature that allows a user to designate a legacy contact. There is a similar feature available for Android phones. They allow a survivor to access the phone in the event of the user’s death. This can be a very useful estate planning tool, as Beth Pinsker explains.
An activist pushes for change at an LSD company
Ciara Linnane and Steve Gelsi interview an activist investor pushing for change at MindMed, whose CEO punches back. The New York-based biotechnology company develops psychedelic-inspired therapies for addiction and mental illness.
Year-end tax planning as stock market losses mount
Here’s how this year’s lousy market may help your bottom line come tax time, even if you aren’t rich.
Read on: ‘Help is on the way’: Need to speak to someone at the IRS about your taxes? It’s about to get a lot easier, IRS commissioner says
Changes to credit scores in the housing market
The U.S. mortgage market is effectively nationalized, with Fannie Mae and Freddie Mac direct wards of the state and purchasing nearly all newly originated mortgage loans.
Now, the federal government has directed Fannie and Freddie to make use of alternative credit scores, which may well affect someone you know who is looking to buy a home.
On Oct. 27, Freddie Mac said the average interest rate on a fixed 30-year mortgage loan in the U.S. was 7.08%, up from 3.14% a year earlier.
But with all the talk about a possible recession, some mortgage bankers expect loan rates to drop in 2023. Here’s how far rates may fall.
Now it’s truly Twitter time for Elon Musk
Tesla and SpaceX CEO Elon Musk is now running Twitter as well — he began by firing three of the social-media company’s top executives, for which he is on the hook for $200 million.
More about Musk and Twitter:
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-Philip van Doorn
(END) Dow Jones Newswires
10-28-22 1252ET
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