Megacap Tech Rebound Reignites Fear of ‘Extreme’ Valuations
- Morgan Stanley sees echoes of dot-com era in tech stocks
- Apple and Amazon have led the group’s recent advance
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Major U.S. technology and internet stocks have returned to favor on Wall Street, renewing concerns about valuations as investors rotate back into growth-oriented names amid a decline in Treasury bond yields.
With the S&P 500 information technology index up about 16% this year, Morgan Stanley Wealth Management sees valuations as “extreme,” noting that the sector’s price-to-sales ratio of 7.4 has risen to levels last seen during the dot-com bubble in 2000.