With the Nasdaq 100 Stock Index ($IUXX) (QQQ) trading just below last month’s 1-1/2 year high, more insiders at technology companies are unloading shares. The insider selling could indicate that executives see further gains as limited and that the market is near a top. The number of executives and other insiders of tech companies selling stock in their companies rose to 441 in June, according to data from Washington Service, the highest since December 2021, the month after the Nasdaq peaked.
The Nasdaq 100 is up +38% so far this year, and the prices of tech stocks relative to projected profits are well above levels before the Covid-19 pandemic. Bloomberg Intelligence said, “With valuations so high, it’s a decent time to take some chips off the table.” This year’s rally in technology stocks has occurred amid optimism about the tech sector’s resiliency in the face of higher interest rates and economic uncertainty and the ability of the biggest companies to capitalize on the demand for products enhanced by artificial intelligence features.
