Shares of Apple Inc. and Alphabet Inc. both suffered their largest weekly declines since the beginning days of the pandemic this week, as Big Tech companies continued to draw closer scrutiny from Wall Street.
finished down 11.2% on the week, its worst weekly performance since the week that ended March 20, 2020, according to Dow Jones Market Data. The stock declined 17.5% during that early-pandemic stretch.
Shares of Apple fell during all five sessions this week.
Shares in Google parent Alphabet
declined 10.1% during the week, their worst one-day percentage drop since that same March 20, 2020 week, when they fell 12.03%. The stock’s biggest weekly tumble in more than two years came even as Alphabet snapped a four-session losing streak in Friday trading.
While Apple’s stock has fared better than that of Alphabet and other Big Tech peers, the company faces potential pandemic-related challenges owing to new COVID-19 setbacks at manufacturer Foxconn’s major facility. In addition, the realities of the current economic climate may be catching up to Apple, as Bloomberg News reported Thursday that the company had paused hiring in several areas unrelated to research and development.
Though there didn’t seem to be any major news developments pegged to Alphabet specifically in the past week, investors are putting more pressure on big internet companies, according to Bernstein analyst Mark Shmulik. He recently conducted a Big Tech “autopsy” of results from Alphabet, Amazon.com Inc.
and Meta Platforms Inc.
concluding that “perfection is required from here” for the three tech giants since Wall Street has less patience for weak performance in any one of their many business areas.
All three names suffered negative stock reactions in the wake of their latest earnings reports, which indicated challenges in the ad market due to economic pressures. At Alphabet specifically, “Search was more or less in-line with the buy-side bogey and the Cloud beat, but disappointing YouTube results combined with margin contraction drove a ~10% fall after-hours,” Shmulik wrote.
Alphabet’s stock has declined 40% so far in 2022, while Apple’s is off 22% over the same span. The S&P 500
is down 21% on the year while the Dow Jones Industrial Average
is off 11%.