Tech Stocks Wipe Out $1 Trillion Amid Rising Oil Prices and Inflation Fears
Brent crude prices exceeding $110 for the first time since May and geopolitical tensions have triggered massive losses in tech stocks across global markets.
Driven by rising energy costs, geopolitical tensions, and concerns over interest rate hikes, more than $1 trillion in value was wiped out from tech stocks on Friday, while Brent crude surged above $110 a barrel for the first time since May.
Amid this sharp market volatility, the Nasdaq 100 index lost 2.5%, the S&P 500 index dropped 1%, and the Russell 2000 index fell 1.6%. While Brent crude oil prices reached their highest level since May, U.S. crude oil also closed up 3.5% at $101.41.
The surge in energy prices and accompanying inflation fears have reinforced the likelihood that the U.S. Federal Reserve (Fed) will raise interest rates again. These fuel price increases are driven by geopolitical developments, including the closure of the Strait of Hormuz and the negative impacts of the Russia-Ukraine war on refinery capacity.