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Tech Stocks Drag ASX 200 Down For The Year

A collapse in tech stocks has dragged the ASX 200 down 10.2 over the financial year, and there looks to be little relief coming in the next few months.

While this spells disaster for a lot of local technology companies, Macquarie reassured clients this is a global issue, pointing out this last half-year has seen “some of the worst year-to-date returns on record for the S&P 500 as inflation fears, rising rates and geopolitical unrest has dampened the mood of equity investors.”

Lithium and coal stocks shored up the ASX 200, with Core Lithium leading the pack with 280 per cent returns, followed by Lake Resources with returns of 155 per cent.

Online betting hub Pointsbet (falling 75.10 per cent), payments management provider EML Payments (64.68 per cent), and buy now pay later merchant Zip (93.77 per cent) are among the worst performing stocks in the ASX 200.

EML Payments CEO Tom Cregan told The Australian that “not many companies can outrun local or global sentiment”, pointing to the likes of PayPal, who have also fallen.

Zip has shed 94 per cent of value during a horror year for the BNPL sector, with market corrections, increased competition from the likes of PayPal and Apple, and regulators swarming.

Zip CEO Larry Diamond issued an update just last week, in a bid to reassure investors as the company’s stock fell to new five-year lows.

“We have been clear that in response to current market conditions our strategic priorities are to focus on our core business, both products and regions, and accelerate the group’s path to profitability,” Diamond said.

“In an environment where wage growth is falling behind heightened inflationary pressures, affordability becomes an even more important priority for consumers as they budget each month.

“We believe our business model will stand up exceptionally well in such an environment as we continue to provide significant value and benefit to our customers and importantly our merchant partners seeking to drive continued growth.

“We are well-funded and positioned to execute on the significant market opportunity as we execute and take control of our future.”

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