Declines in last year’s stalwarts, from Facebook Inc. to Amazon.com Inc., punished the Nasdaq Composite Index for the fourth time in five days Monday, pushing the gauge’s rout since the July record to 18 percent and leaving it at the lowest since October 2014. Once again, selling was heaviest in shares with the highest price-earnings ratios and among momentum stocks, causing the engine of the bull market to sputter as it nears its seventh anniversary. “Some of those got way over-extended in terms of valuation and really weren’t trading on valuation either, they were just trading on growth and momentum,” said Sean Lynch, co-head of global equity strategy for Wells Fargo Investment Institute. “Anytime you start to see cracks in the market or worries about the economy build up, certainly valuation becomes a little bit more of a focus.” (VIEW LINK) (source: Bloomberg)
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