AILSA CHANG, HOST:
All right, today was the last trading day of the month. U.S. markets are closed for Good Friday. Stock prices were up today after two days of losses, and the month as a whole was pretty bruising. For the first time in years, technology companies like Facebook, Google and Amazon are leading the way down. NPR's Jim Zarroli explains why.
JIM ZARROLI, BYLINE: Ever since the Great Recession, the U.S. economy has been growing at a pace that can usually be described as tepid. Sameer Samana of Wells Fargo Investment Institute says the one big area of promise has been technology companies.
SAMEER SAMANA: If you think about social media, if you think about e-commerce, basically technology is the backbone of all of those different things. And for those corporations it's driven incredible profit growth.
ZARROLI: And this has made tech stocks such as Apple, Amazon, Facebook and Google soar. Over the year ending on March 5, for example, Apple was up 29 percent. Juli Niemann, an analyst at Smith Moore and Company, says even when other stocks have underperformed, the love affair between Wall Street and tech stocks never waned.
JULI NIEMANN: Oh, tech stocks have been the dominant area. This is one thing that consumers - investors have jumped all over simply because they can understand them. They love these stocks.
ZARROLI: They love them, that is, until about two months ago. Niemann says there's no single reason for what's happened. Each company has had its distinct set of problems. Apple faces questions about its growth. How long will people keep buying bigger and better iPhones? Amazon is being attacked in tweets by President Trump. Tesla is facing production issues. And then there's Facebook.
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UNIDENTIFIED REPORTER: This morning, Facebook under fire, the pressure intensifying in the wake of that Cambridge Analytica privacy scandal affecting up to 50 million users.
ZARROLI: The uproar over Facebook's breach of user data is generating calls for strict government regulation of the social media giant. Since the beginning of February, Facebook's shares are down by 20 percent. Taken together, these problems have raised questions about the tech sector as a whole. Again, Juli Niemann.
NIEMANN: The market has a psychology right now of when in doubt, get out. We'll figure it out later what happened. And when you have a market that's that shaky, especially when the valuations are really high at this point, it's not happy Harry's house of bargains out there.
ZARROLI: The tech fallout isn't the only problem plaguing the stock market right now. The Trump administration has imposed tariffs on Chinese imports, which is sparking fears about a trade war. And the Fed and other central banks are raising interest rates, something stock investors never like. But the tech crowd is especially problematic because tech stocks make up a huge portion of the shares traded every day. About 25 percent of the companies in the Standard & Poor's 500 index are in tech. They make up a big proportion of the stock in most mutual funds and retirement accounts. Sameer Samana thinks the downturn is temporary. After all, he says, tech is still a relatively new industry.
SAMANA: We're still trying to figure out, you know, how things like social media fit into our lives and how data should be managed and all those different things. So I think this is just part of the growing pains of how do we regulate these companies?
ZARROLI: But for now, a lot of investors are reassessing whether tech stocks are the great bet they once thought they were. And until that changes, it's going to hurt the market as a whole. Jim Zarroli, NPR News, New York.
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