Volatility in risky US tech stocks may persist this week

THIS week could see the volatility continue as investors' doubts about valuations, economic growth and Federal Reserve policy build.

Shares of the large-cap tech stocks that had driven most of the broad market gains for the year-to-date, including Amazon.com, Apple and Google's Alphabet, shed large chunks of their gains on the year. The previous week, analysts at brokerage Goldman Sachs had warned that their gains were founded on an overly optimistic growth outlook. They compared the behaviour of the largest tech companies of Nasdaq 100 stocks to the dotcom boom of the late 1990s.

While the gains for Amazon.com and its peers this time around were not quite as extreme as during that era, "parallels are growing", said the Goldman analysts. Consider the price-to-earnings multiple for Amazon.com. Historically, the average price-to-earnings multiple for a Standard & Poor's 500 company has been around 15. Amazon's shares are priced at a staggering 180 times last year's per-share earnings total.