Australian tech shares are being smashed

The market has managed to edge higher today despite heavy declines being seen in the information technology sector.

At the time of writing the S&P/ASX 200 Info Tech (Index: ^AXIJ) (ASX: XIJ) is down over 1.9%, restricting the benchmark S&P 200 to just a 0.1% gain.

This follows a weak night of trade on Wall Street which saw a number of tech shares and the Nasdaq index fall heavily.

For example, Twitter fell a further 8% and the FAANGs were all in the red. Netflix was the worst performer in the group with a 6% decline.

Investors appear to have been taking profit off the table in the United States amid concerns over trade wars. This came after Reuters reported that the European Union, Canada, Japan, Mexico, and South Korea plan to meet next week to discuss a response to threats made by President Donald Trump.

This has led to a similar selloff of high PE tech shares on the local market. Here is the state of play in early afternoon trade:

  • The Afterpay Touch Group Ltd (ASX: APT) share price has dropped 3% to $14.07.
  • The Altium Limited (ASX: ALU) share price is off 2.2% to $20.89.
  • The Appen Ltd (ASX: APX) share price is down 2% to $10.92.
  • The Ltd (ASX: KGN) share price has dropped 4.5% to $4.86.
  • The Nearmap Ltd (ASX: NEA) share price is down 4% to $1.48.
  • The NEXTDC Ltd (ASX: NXT) share price has fallen 4% to $7.08.
  • The WiseTech Global Ltd (ASX: WTC) share price has plunged 6% to $15.57.
  • The Xero Limited (ASX: XRO) price is down 2% to $43.00.

Should you buy the dip?

I think that several of these shares will be worth a closer look when the dust settles. Though, it may be worth waiting for the meeting mentioned above before making a move, just in case it causes more money to flow out of riskier assets.

In the meantime, these buy rated shares could be great investments.

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Motley Fool contributor James Mickleboro owns shares of NEXTDC Limited. The Motley Fool Australia owns shares of and has recommended Nearmap Ltd. The Motley Fool Australia owns shares of AFTERPAY T FPO, Altium, Appen Ltd, WiseTech Global, and Xero. The Motley Fool Australia has recommended ltd. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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