Tech stocks tumbled on Tuesday after the release of inflation data. CPI Inflation was 8.3% in August, slightly higher than the market expectations.
Now the inflation print is more than expected, there is a high chance that the Fed may hike the interest rate by 75 to 100 basis points in September FOMC.
The Tech sector is very volatile to rising inflation and interest rates. Stocks of many tech companies are already down by 60% from the Highs of November 2021.
Among the top FAANG Companies, Apple Stock is the least affected by rising inflation and is only down by 15%. While the tech index Nasdaq-100 was down by 28% from its Highs in 2021.
Tech Sector is the worst-performing sector when it comes to rising inflation. As the borrowing cost increases, it becomes difficult for companies to make new investments.
Due to rising costs of living, many companies face a revenue slowdown as customers cut their budget spending.