Technophobia? Why ASX 200 tech shares are getting hammered again

Fans of ASX 200 tech shares can likely blame today’s losses on international markets.

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Kid with a brown paper bag on his head which has a sad face on it sits in front of an old style computer representing falling ASX 200 tech shares today

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Key points

  • The ASX 200 tech sector is struggling today amid a broader sell-off
  • The sector's continued slide has likely been spurred by the recent performance of the Nasdaq Composite. The US index tumbled another 4% overnight
  • Block Inc is the biggest weight on the ASX 200 technology index today. Though, some market favourites are defying the downturn

S&P/ASX 200 Index (ASX: XJO) tech shares are being slammed on Tuesday after the Nasdaq Composite (NASDAQ: .IXIC) continued to tumble into market crash territory overnight.

The tech-heavy US-based index extended its slump in Monday’s session overseas, recording a 4.29% fall and bringing its losses for the last six weeks to 20.5%.

Seemingly in reaction, the S&P/ASX 200 Information Technology Index (ASX: XIJ) is plunging 1.25% at the time of writing, having sunk by almost 5% in early trading. It’s being dragged down by most of the ASX’s prominent tech shares.

For context, the ASX 200 is recording a 1.63% slip right now.

Let’s take a closer look at what’s going on with the Nasdaq Composite and its impact on ASX 200 tech stocks.

ASX 200 tech shares’ Tuesday tumble

ASX 200 tech shares are suffering after the US tech-heavy index tumbled amid continued concerns about rising interest rates.

The Nasdaq Composite ended yesterday’s session in the red, as did the S&P 500 Index (SP: .INX) and the Dow Jones Industrial Average Index (DJX: .DJI). The latter indexes fell 3.2% and 1.99% respectively on Monday.

Their continued downturn follows the US Federal Reserve’s decision to raise interest rates by 0.5% last week, according to reporting by Reuters.

Nasdaq giant Tesla Inc (NASDAQ: TSLA) was one of the index’s biggest weights overnight, recording a 9% fall.

Back on the ASX on Tuesday, the tech sector is being dragged down by Block Inc (ASX: SQ2). Its share price is tumbling 10.27%.

Meanwhile, stock in NextDC Ltd (ASX: NXT), Computershare Limited (ASX: CPU), Novonix Ltd (ASX: NVX), and Altium Limited (ASX: ALU) are recording drops of 4.6%, 2.6%, 2.2%, and 1.7% respectively.

Though, it’s not all dire among the ASX’s biggest tech stocks.

Shares in Life360 Inc (ASX: 360), Tyro Payments Ltd (ASX: TYR), and Iress Ltd (ASX: IRE) are leading the sector. They’re gaining around 3.9%, 2.4%, and 2.1% respectively.

The Xero Limited (ASX: XRO) share price is also in the green.

The ASX 200 tech sector has plummeted more than 23% since its most recent high in early April. It’s also more than 33% lower than it was at the start of 2022.

Motley Fool contributor Brooke Cooper has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has positions in and has recommended Altium, Block, Inc., Life360, Inc., Tesla, Tyro Payments, WiseTech Global, and Xero. The Motley Fool Australia has positions in and has recommended Block, Inc., WiseTech Global, and Xero. The Motley Fool Australia has recommended Tyro Payments. 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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