- The Google I/O Conference starts on Tuesday, with expectations for a possible unveiling of a new smartphone, the Google Pixel 5A, a preview of new version of Android and maybe a project on a new CPU.
- Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) fell 3% last week, but has been the stalwart of the Big 6 megacaps this year.
- It's up 30% year to date, followed by Facebook (NASDAQ:FB), up 15.7% and Microsoft (NASDAQ:MSFT), up 11.6%.
- Amazon (NASDAQ:AMZN) is down 1%, Apple (NASDAQ:AAPL) off 3.5% and Tesla (NASDAQ:TSLA) down 16.4% year to date.
- But Alphabet fell 3.1% last week, the second-biggest drop among the megacaps behind the 12.3% plunge in Tesla.
- The stock is now moving closer to its 50-day simple moving average.
- It survived a test of that technical level in late March and was last below it in January.
- Alphabet's relative strength index remains right in the sweet spot between overbought at 70 and oversold at 30, just below 50.
- Other megacaps are battling much lower technical levels.
- Apple successfully passed a test of its 200-day moving average this past week. Tesla dipped below its 200-day SMA for the first time since the depth of pandemic selling.
- In 2021, the Communications Services (NYSEARCA:XLC) sector has outperformed the other megacap sectors - Info Tech (NYSEARCA:XLK) and Consumer Discretionary (NYSEARCA:XLY) - thanks in large part to Alphabet and Facebook.
- Alphabet is the seventh-best performer in the sector, with News Corp. (NASDAQ:NWSA), Lumen Technologies (NYSE:LUMN) and Dish Network (NASDAQ:DISH) the top three.
- XLK is the worst-performing sector this year, up 4.6%.
- XLC just dipped below its 50-day SMA for the first time since January, but recovered on Friday's rally.
- But the sector has seen the biggest outflows of any other sector for 2021, down more than $5B, BofA Securities' latest client survey shows.
- Overall, equity outflows are at $7.6B for the year.
- Last week flow to to XLC were in the middle of the pack, just slightly down, and XLK saw the biggest outflows.
- "Clients sold stocks across seven of the 11 sectors, led by Tech (biggest outflows since early Jan. amid last week’s Growth-to-Value rotation)," strategists led by Jill Carey Hall wrote in a note. "Rolling four-week avg. flows into Tech hit record levels in mid-March, and are now shifting increasingly negative. The last time Tech saw such extreme inflows (both absolute and vs. mkt. cap) was in Jan’14, after which it underperformed over the next 3 mos."
- Seeking Alpha Contributor Thomas Lott did a deep dive into Alphabet on the sum of its parts.