NEW YORK (Reuters) – Nasdaq’s retreat from its historic highs last month is now officially considered a correction in a bull market.
The high-tech index on Monday closed down 2.22% unofficially at 12,633.61, about 10.6% below the record close of February 12 at 14,095.47 and exceeding the closing limit of 10 % considered by market professionals to confirm a correction. Nasdaq entered the most recent bull market last March and has risen more than 105% since the pandemic low of a year ago.
Market-leading technology and megacap stocks adjacent to the technology, which account for much of Nasdaq’s total market value, thrived during the pandemic recession. But many of these stocks are now viewed by some investors as overvalued.
More cyclical stocks, which were affected by stoppages and are expected to benefit more from the economic recovery, have gained preference as the vaccine implantation gains strength and restrictions are lifted.
In the year, the Nasdaq fell 2.2%, while the S&P 500 and Dow rose 1.7% and 3.9%, respectively.
(This story corrects the start date and the percentage gain of the bull market in paragraph 2)
Stephen Culp reporting; Editing by Alden Bentley