The S&P/ASX 200 Index (ASX: XJO) is having a rather shaky start to trading this Thursday. At the time of writing, the ASX 200 is down 0.099% to 7,347 points. One ASX share that is faring worse today though is A2 Milk Company Ltd (ASX: A2M).
A2 Milk shares are currently down a nasty 2.52% so far today to $6.95 a share. This fall continues a trend we have seen playing out all week. Since Monday morning, A2 shares are now down near 4%, somewhat reversing the recent recovery in A2 Milk shares.
Remember, this is an ASX 200 share that has had a very rough 12 months or so. The A2 Milk share price is still down more than 40% year to date, and almost 65% down over the past year. A series of earnings downgrades, largely sparked by a collapse in the Chinese-driven daigou trade, are largely to blame here.
In saying that, we have also seen some strong signs of life in recent months too. Back in mid-May, A2 Milk shares bottomed out at a new multi-year low of just $5.04 a share. Since then, the company is now up an impressive 35%, even after today's fall.
But let's get back to why the A2 Milk share price is under pressure today. What's going on?
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Why is the A2 Milk share price under pressure today?
Well, the first thing to note is that there are no official news or announcements out of the company today that can easily explain this fall.
But we are seeing a number of ASX shares today that are falling by more than the ASX 200 itself. Although it might not seem like it after the year A2 has had, this company used to be thought of as a high-flying ASX growth share.
As such, it might be reacting alongside other ASX growth shares to a sharp sell-off over in the US markets last night. Yesterday's session on the US markets saw shares like Tesla Inc (NASDAQ: TSLA), Nio Inc. (NYSE: NIO) and GameStop Corp. (NYSE: GME) sell off heavily, all losing more than 2% (nearly 7% in GameStop's case).
Today on the ASX, not only is A2 Milk falling, but we also see similar moves from growth shares like Afterpay Ltd (ASX: APT), Zip Co Ltd (ASX: Z1P) and Bubs Australia Ltd (ASX: BUB). Perhaps the A2 Milk share price is just being caught up in a sell off in the 'growth shares region' of the market.
Whatever the reason, it's certainly been an interesting day for A2 Milk shares so far. At the current A2 Milk Company share price, the company has a market capitalisation of $5.3 billion.
