After being seen as a subprime safe haven for some time, tech has newly become an investor wasteland. Cisco, Sun and Qualcomm have all disappointed to greater or lesser disagrees, and investors have taken the whole group out back and shot ’em.
Consider the following chart showing some sample group performance from September 1st until now, with and without the current tech wreck week:
The entire above group had turned in positive performance numbers from September 1st until the beginning of this week. You could have thrown a dart at tech and pretty much felt like you had magically found a subprime safe haven. This week, however the wheels fells off, with a few disappointments causing investors to become pissed at the bunch, taking it down an average of 10% on the week.
So, which is it? Is tech a safe haven, or is tech as subprime screwy as the financial sector? While no sector is entirely safe — perfect safety is for people who keep their money out of the stock market — the reality is that the tech as subprime safe haven theme was always a gross oversimplification. There are good tech stocks, and there are poor tech stocks, and there are those that were taken up by a rising tide. I still like Google, RIMM, VMW, and MSFT in here, and while I’m somewhat uneasy with AAPL — I think the newsflow could be dodgy from now through early next year — I have a hard time hating the group.