NEW YORK (Reuters) – Last month’s Nasdaq pullout from its all-time high is now officially viewed as a correction in a bull market.
The tech-heavy index unofficially closed 2.22% on Monday at 12,633.61, about 10.6% below the February 12 record at 14,095.47 and crossed the 10% closing threshold considered by market professionals as confirmation of a correction . The Nasdaq entered the last bull market last March, rising more than 105% from its pandemic low a year ago.
Market-leading technology and tech-adjacent mega-cap stocks, which account for much of the Nasdaq’s total market value, thrived during the pandemic recession. But many of those stocks are now considered overvalued by some investors.
More cyclical stocks, battered by shutdowns and likely to benefit the most from the economic recovery, have since become favored as vaccine deployment picks up steam and restrictions are lifted.
For the year, the Nasdaq is down 2.2%, while the S&P 500 and Dow are up 1.7% and 3.9% respectively.
(This story corrects bull market start date and percentage gain in paragraph 2)
Reporting by Stephen Culp; Editing by Alden Bentley