What a day it has been for ASX shares. The S&P/ASX 200 Index (ASX: XJO) has lost another 1.38% so far today at the time of writing and is now only a few points above the 7,000 mark. For most of the morning, it was ASX tech shares that had borne most of the brunt of this sell-off, as is typical these days. We saw shares like Block Inc (ASX: SQ2), Zip Co Ltd (ASX: ZIP), WiseTech Global Ltd (ASX: WTC), and Xero Limited (ASX: XRO) absolutely slaughtered.
Soon after open, the S&P/ASX All Technology Index (ASX: XTX) dropped as much as 4.4%, reflecting these losses.
But something strange has happened as the trading day has stretched on. ASX tech shares have staged something of a remarkable recovery. Although the All Tech Index was down 4.4% at one point, it is now only down 0.2% at the time of writing. What’s more, the All Tech Index broke even around midday and was in the green for a time.
ASX tech shares bounce back
We see this index recovery reflected in many ASX tech share prices. Xero is a perfect example. The cloud-based accounting software provider was down around 3.6% earlier this morning and hit a new 52-week low of $81.27. But now, Xero shares have bounced back and are trading at just over $87 now, up 3.23% for the day.
WiseTech shares have followed a similar pattern, recovering from close to a 7% loss to now boasting a near-3% gain.
It is unknown what is causing this extreme volatility in the ASX tech shares space. Perhaps investors have just decided that the falls of this morning went a little too far. And this is only over the course of one trading day. Who knows what the rest of the week will bring.