The stock market in recent months turned into a fight between tomorrow’s trade and today’s live offer, and in the last week it became complicated.
Stocks valued with promises of a transformed future have sold hard in favor of those that are poised to thrive in today’s economic upswing. However, after last week’s erratic swings that culminated in Friday’s sales crescendo and a powerful upside reversal, could these adversaries coexist more peacefully for a while?
“Disruptive technology” stocks and upstarts before income and speculative SPACs with a high story-to-substance ratio have taken a big dump since mid-February.
ARK Invest’s fixation on ETFs from party to famine has been appropriate, irresistible, and probably now overdone. The flagship ARK Innovation (ARKK) fund at Friday morning’s low had lost more than 30% in about three weeks. The fund has been a popular enough short that stocks are difficult to borrow and Wall Street desks have been busy creating synthetic versions of the ETF for hedge funds to bet on.
Was it a short-term capitulation in this subsector, which preceded a 10% rebound in ARKK from morning to close on Friday?